With financing for business aircraft still far from easy to secure, ExecuJet Aviation has stepped up its efforts to help get more people airborne through its SimplyFly Finance program. The plan is to offer fast-access, simplified nonrecourse financing in the shape of five-year loans or leases for up to 70 percent of the value of an aircraft worth at least $20 million and no more than five years old. An initial fund of $400 million provided by ExecuJet’s main shareholder Dermot Desmond is available to support the program.
CRS Jet Spares reports a 25-percent decrease in customer additional billings (billbacks) over the past 18 months as a result of its Option 2 pricing program.
When an operator needs a part, an exchange transaction is the common method of handling the purchase. The problem with that type of transaction is there’s the chance of a billback to the operator at a later date based upon the actual condition of the core.
The used business jet market has not yet reached equilibrium. That was the general consensus among industry experts at the National Aircraft Resale Association (NARA) forum in Dallas at the end of February.
Buying an aircraft can be a daunting task. Unless a company or individual has deep pockets, it will inevitably require either leasing with an option to buy or financing a purchase. Even if paying in cash is an option, doing so can be problematic. Dave Labrozzi, senior v-p and general manager of Danbury, Conn.-based GE Corporate Aircraft Group, explained the difference between leasing with an option to buy and outright purchase.
Low demand for corporate aircraft and small airliners has led New York-based financial advisor Moody’s Investors Service to review, and possibly downgrade in
the next two months, certain Bombardier debt ratings. Bombardier Aerospace’s intermediate-term earnings and cash flow could be constrained by any adverse market effects, according to Moody’s corporate finance group senior vice president Tassos Philippakos.
Many business gurus believe knowledge is power, but the ability to transform that wisdom into action is the real measure of success. With just that goal in mind, 17 general aviation business leaders–CEOs, presidents, CFOs and operations managers–gathered at Northwestern University’s Transportation Center recently for the Strategic Management for Aviation Service Firms conference.
When Silver State Helicopters salesman “John Smith” (not his real name) was laid off in mid-November from his job recruiting student helicopter pilots, he figured that the now-bankrupt company was cutting expenses in an attempt to make the financials look better for an initial public stock offering. Silver State owner Jerry Airola had often discussed an IPO, according to Smith, and it seemed that it might be a possibility.
The process for deciding whether or how to buy a business aircraft is fraught with seemingly incalculable factors and subjective considerations. Over the past five years a small French company called Aero Capital claims to have developed an armory of software power and expertise that can give prospective buyers a higher degree of reassurance that they are making the right move.