ACJ study: Majority expect business aviation finance access increase

A new study commissioned by Airbus Corporate Jets (ACJ) has found that 82% of US-based business aviation financiers and brokers expect access to financing to increase over the next three years.

Just 1% predicted a decline over that period. Some 98% of survey respondents believe business aviation finance rates are still attractive, and it is still better to use credit when buying an aircraft as opposed to tying up capital. However, over the next five years, 25% expect a dramatic increase in the size of cash deposits used in the purchase of business jets.

“The business aviation market is predicted to enjoy consistent growth in the coming years, and aircraft financing will be key to facilitating this growth,” said Sean McGeough, VP Commercial ACJ for North America. “Many of those purchasing aircraft do not want to tie up huge amounts of their capital in the transaction and turn to leasing and other forms of credit.”

With fiscal and monetary policy uncertainty, 74% of respondents see fixed-rate transactions as opposed to floating rates to increase over the next five years amongst those using leases and credit. Also, 69% of business aviation financiers and brokers believe demand for operating leases will increase between now and 2028.

The study found, because demand for larger business jets is increasing, 77% believe that securing financing for them will be easier compared to midsized and smaller jets. Whilst, 68% believe that specialist lenders will increase their market share over mainstream banks.

McGeough added: “The business aviation finance market is very competitive with many financial players willing to lend money to meet their client’s needs. Innovation and flexibility in the sector is also increasing and we expect this to continue.”

This year represents the first time that an ACJ TwoTwenty is on display at an NBAA-BACE conference. See the aircraft at Static #AD_07.