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Global Airline Passenger Capacity to Surpass 2019 Levels in October, IBA Predicts

IBA’s latest Aviation Industry Barometer predicts that global passenger ASKs (available seat kilometres) will surpass 2019 levels by October 2023, having reached 95% of pre-pandemic ASKs in June 2023.

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Paris Air Show round-up: $72.4bn total, with most firm orders ever

IBA Weekly Date: 23/06/2023 (issue 32) Whilst Paris Air Show is known to be quiet on the last two weekdays, no one quite expected the absence of significant business that would continue until late on Monday. This quiet was broken by a blockbuster 500 aircraft order from IndiGo. Air India then followed up by firming their 470 aircraft order the next day. The week had been flush with rumours of large orders, leading IBA to forecast a total greater than 2,000 aircraft. We did not hit that estimate. However, if Turkish Airlines had committed to their rumoured 600 aircraft order, we would’ve been very close! At the time of writing, on Friday lunchtime, the total orders including Firm, MOUs, LOIs and Options reached 1,303 aircraft, worth $72.4bn based on IBA’s 2023 Current Market Values. This is an impressive total, with only 2013 accruing a larger tally. A more interesting detail is that 1,160 (89%) were firm orders, the highest ever. Having firm orders is good news for the programmes in terms of long-term confidence in them as well as securing Pre-Delivery-Payments (PDP). Large orders will allow the operator to demand a superior price, however, the OEM may also be able to benefit from demanding higher PDP in the higher risk transactions. Operators appear to be firming up orders to secure delivery slots in an environment of supply delays. However, with orders of such scale, questions arise as to whether the local markets can accommodate the growth. This is especially the case when the two airlines making the largest orders are in the same country. Source: IBA Insight & Intelligence Indian carriers dominated orders as expected The Airbus press conference on Monday got the tally off the ground, announcing 500 new A320 family aircraft for IndiGo. In numerical terms, this eclipsed the 470 Air India order that was firmed on Tuesday, with the Boeing and Airbus announcements happening almost simultaneously, as to avoid one getting more headlines. It is also worth noting that IndiGo already had a backlog of 485 aircraft, putting their new total just shy of the 1,000 mark. IBA values this new order at $28.0bn. Despite the numerical inferiority, IBA value Air India’s order at $33.1bn. This difference can be attributed to Air India also ordering widebodies. Their order in full was 220 aircraft, with Boeing (190x 737 MAXs, 20x 787s and 10x 777Xs) plus 250 aircraft with Airbus (140x A320neos, 70x A321neos and 40x A350s). There is also an option with Boeing for a further 50x 737 MAXs and 20x 787s), which would take their order total to 540. Unlike IndiGo’s Airbus loyalty, the order is split between the two large OEMs, reflecting the very mixed fleet of the Indian flag carrier and its present and future subsidiaries. Including widebodies in the order will likely solidify the airline’s dominant international market share (27.8% share compared to IndiGo’s 10.7% in 2023). The airline severely lags IndiGo in the domestic market share however (26.6% compared with 57.5% of IndiGo). Both are expecting to gain share from each other but will also be reliant on the market’s growth. Recent estimates have the Indian aviation market growing at 9% annually and the country has pledged $12bn to Indian infrastructure. Whether that can accommodate these 970 aircraft before their first flights, is another thing. Avolon led the lessors With the scale of the orders, one could be forgiven for thinking there were lots of participants. Among operators, Western Europeans were conspicuously absent, albeit Ryanair had placed a large 150 aircraft order (plus 150 option) pre-show. It was also the case with lessors. Avolon’s 40x 737s and 20x A330 order, as well as an 80 LEAP engine deal the only large business among them. Interestingly, Avolon’s ratio of orders to current fleet is getting closer to parity, similar to the likes of well-known speculative lessors like Air Lease Corporation (ALC). In an aircraft supply bottleneck, the lessor has more control over lease rental pricing. This is compared to an operator receiving multiple lessor offers for Sale and Leaseback. This relationship of course reverses in oversupply. Their A330s are expected to be delivered through 2026-2029, with the narrowbodies likely in the 2030s. We don’t know what the market will look like then, so these orders are therefore purely speculative. Source: IBA Insight & Intelligence Airbus beat Boeing comprehensively The week had success for many OEMs with De-Havilland’s 49 aircraft orders and Embraer’s 28 up among pre-Covid levels. However, the gulf between Airbus and Boeing was quite sizeable. As discussed earlier, IndiGo operate solely A320 family aircraft which pulled the OEM far ahead in the narrowbody stakes. Airbus already led pre-show in total backlog with 8,546 aircraft to Boeing’s 7,069. When looking at the A320neo and 737 MAX alone, the Airbus advantage was 1,300. This is now wider. In the show, Airbus totalled 846 orders. This is over double Boeing’s 356 orders. What is particularly interesting is that Airbus also won on the widebody stakes this year, with 72 firm orders to Boeing’s 40 (excluding 20 on option). Boeing had exceeded Airbus in widebody orders in eight of the last ten years. Boeing will be hoping that production delays to the 777X don’t cause a turning point. Source: IBA Insight & Intelligence This IBA Weekly was written by: Neil FraserHead of Consulting Neil FraserManager - Airline Analysis

Articles

Indigo Order Paris Air Show 2023

IndiGo’s order of 500 aircraft has notably eclipsed Air India’s 470 aircraft order made only in February this year (although there was also an option for 70 aircraft). When added to IndiGo's substantial existing backlog, questions will arise whether the Indian market can accommodate this number of aircraft.

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IBA Insight Shows Middle East Airlines Surpassing Pre-Pandemic Capacity

IBA’s latest Aviation Industry Barometer shows that Middle Eastern operators surpassed pre-pandemic capacity with ASKs at 103% in May 2023 compared to 2019 levels.

Paris Air Show returns in June 2023 after a four year break.

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IBA's predictions for Paris Air Show 2023

IBA's Chief Economist, Dr. Stuart Hatcher reveals his insights and sales predictions for The Paris Air Show 2023.

Regional aircraft engine values face turbulence in early 2023

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Turbulence ahead for some regional aircraft engines, whilst others continue to outperform the market.

IBA's experts examine the latest trends in regional engine values and utilisation in our latest webinar 'IBA Insight - How are engine values performing?'.

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Mature Widebody Engines Unlikely to Recover to Pre-Covid Levels

IBA's experts Jamie Davey and Phil Seymour took a deep dive into the latest trends in widebody engine values and utilisation in our latest webinar 'IBA Insight - How are engine values performing?'.

Articles

Easter flights to be at 90 of pre-pandemic levels within Europe

The number of flights operating over the European Easter weekend between 7th – 10th April 2023 will be at 90% of 2019 levels on routes to and from Europe. Aviation intelligence from IBA Insight also reveals that some low-cost carriers will exceed pre-Covid levels.

Articles

Could Saudi ambitions trigger a Middle East power play?

“My grandfather rode a camel. My father drove a car. I fly in jet planes. My son will drive a car. My grandson will ride a camel.” This contested quote relates to the desire to diversify away from an oil-export-dominant economy. Following Qatar and the UAE, it’s now a focus for Saudi Arabia. Aside from the emergence of Avilease last year with the announcement of a 12-aircraft SLB with flynas, the Saudi Public Investment Fund also launched Riyadh Air this week. This was closely followed by the $37Bn list price order for up to 121 x 787-9s to be split between the airline and Saudia. That’s a lot of capacity, and links closely with the Saudi vision to carry 330m passengers by the end of the decade (with close to a third visiting the country). Having spent much of my childhood in Riyadh and witnessing the speed of development, I have no doubt that they can succeed. Might this trigger a Middle Eastern power play whereby Emirates, Etihad and Qatar fight against the Saudi growth to destabilise the profitability for European and Asian carriers hoping to recapture market share? The combined carriers already have 465 passenger aircraft in active service, 95 parked or in storage, and 307 on backlog, I sense that, given their deep pockets, growth will proceed at any cost.

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Articles

ISTAT Americas and IBA's Learning Lunch - what we learned in San Diego

IBA's Chief Economist takes stock of the ain learnings from ISTAT Americas, San Diego, 2023.

Articles

One year on – what’s happened to Russian airline capacity?

Over a year has now passed since the start of the Russo-Ukrainian war, the introduction of sanctions, and the reciprocal closure of western, Russian, and Belorussian airspace to select foreign registered aircraft. This naturally posed a huge challenge to European, Asian, and Russian operators as they worked hard to recover from the Coronavirus pandemic. Finnair elected to use the polar route to reconnect services to Japan, and the southern route to Southeast Asia and China. Flight data from IBA Insight reveals that Finnair operates the same number of flights into Singapore and Tokyo today as they did in 2019, but with increased flight durations on each route of 13% and 31% respectively. The airline’s utilisation of the A350 (with its 300 min ETOPS certification) has helped the carrier adapt flexibly. By contrast, operators such as Scandinavian Airlines have elected to remove Japan from their network altogether and have resumed only 7% of Chinese flights to-date. How have Russian operators been affected by sanctions and airspace closures? Russian operators were, in fact, leading the way in post-pandemic recovery with domestic ASKs already 10% above the 2019 peak by August 2020 and 32% by August 2021. Most notably, domestic ASKs sat at 36% above peak 2019 levels in August 2022, following 4 months of sanctions! Whilst we anticipated domestic growth as a result of a big fall in international capacity, I would have expected the sanctions to have dented passenger traffic to a greater extent. Whilst IBA Insight reveals that flights have reduced by around 11% since 2021, we have also observed flexibility in the utilisation of the Russian fleet. Usage of the A319, 737-700 and 737 classics has reduced in favour of increased deployment of the A321. Furthermore, we have witnessed a 20% increase in the usage of widebody aircraft on domestic routes, placing more reliance on the A330 and 777-300ER, the latter of which has seen a 111% increase in flights. Russian operators halted passenger A350 operations in 2021, and these aircraft were largely grounded at the onset of sanctions. Which international destinations are Russian operators flying to? International Capacity was down by 79% in 2020, recovering to 44% below 2019 levels in 2021. This reduced again to 67% below 2019 levels following sanctions. The number of countries visited by Russian operators had dropped from around 80 to less than 30 by the summer of 2022. The most popular summer destinations for Russian travellers proved to be Turkey (37% of capacity), followed by Tajikistan, Uzbekistan, UAE and Kyrgyzstan (each with around 10% capacity). Winter destinations tell a different story. As of February 2023, Thailand tops the list with 19% of the capacity, followed by UAE with 15% and Turkey coming in third with just 10% (just 29% of summer 2022 capacity). Worthy mentions also include Egypt, Cuba, Sri Lanka, the Maldives, and India. These collectively account for 15% of winter capacity but <5% of summer 2022 capacity. Egypt is proving a noteworthy winner, with a 1300% increase in traffic to the country from Russia. This has been buoyed by limited options, and the 2021 lifting of the ban on direct flights to Egyptian resort cities following the crash of Metrojet flight 9268. Locations such as the UAE, Turkey, The Maldives and Sri Lanka are up 50-75% on 2019, whilst Russia’s largest winter sun location, Thailand, still has some ground to catch up. Myself and the team will continue to monitor and report on the evolving situation for Russian carriers and the impact on lessors and the wider aviation finance community. Don’t miss out on the latest aviation intelligence The IBA team share regular insights on all aspects of commercial aviation, from airline capacity and travel trends to aircraft values and ESG strategy. Sign up today to get the latest intelligence from the IBA Weekly newsletter delivered straight to your inbox. Sign up to our IBA Weekly

Articles

Narrowbody aircraft values set to climb through 2023

New narrowbody aircraft base values rose beyond the long-term trend into 2023, and lease rates are forecast to climb further this year, according to data revealed by Phil Seymour, Mike Yeomans, and Jonathan McDonald in the first of our new series of valuations webinars.

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On this Day in 1987 – First Flight of the Airbus A320

The revolutionary Airbus narrowbody made its maiden flight on 22nd February 1987. It was an all-new aircraft, boasting advanced fly-by-wire technology and a host of other cutting-edge features. The aircraft quickly gained the attention of airlines who wanted to take advantage of its low operating costs, high fuel efficiency and competitive price. The program that would eventually give birth to the aircraft can be traced back to 1977, when the Joint European Transport Program (JET) began working on designs for narrowbody aircraft pitched at the 130-188 seat market. The project aimed to produce an aircraft with a cruise speed of Mach 0.84, faster than the top line Boeing 737 models available at the time. In addition to a speed advantage over the competition, the aircraft could act as an appropriate replacement for the ageing narrowbody fleet operating across Europe (such as older 737 family jets and the BAC One Eleven). The initial single aisle concepts that emerged from the program were designated SA1, SA2 and SA3. These became the Airbus A319, A320 and A321. The A320 went on to be unveiled in Toulouse and took its first flight in February 1987. The aircraft went on to establish itself as the backbone of short and medium haul fleets across the world. The introduction of the A320neo in 2015 effectively stole the march to efficiency in the narrowbody space from Boeing, who's slower introduction of the 737 MAX (and subsequent delays) contributed to Airbus having the highest net orders of any OEM for 4 straight years at the start of 2023. How large is the global A320 fleet? Commercial aircraft fleet data from IBA Insight reveals 4,954 active A320 aircraft as of 22 February 2023. The largest global operator of the A320 is China Eastern Airlines, who currently operate 256 aircraft. Who has the most A320 aircraft on order today? Whilst the first firm orders for the A320 came from British Caledonian Airways, French flag carrier Air France became the launch customer for the type with an initial order for 50 aircraft. The first of these was delivered to the airline on 26th March 1988. The introduction of the IAE V2500 engine option in the early 1990s further diversified the appeal of the entire family, with notable mainline European fleets utilising IAE powered Airbus aircraft. The introduction of the A320neo brought the new generation CFM LEAP-1A and PW1100GM engines into the picture, offering up to 15% more fuel efficiency according to Airbus. As of 22nd February 2023, IBA Insight reveals there are 2,352 active orders for A320 aircraft, which includes all variants. The largest single active order for the aircraft comes from Indian low-cost carrier Indigo, who have 180 A320neo aircraft on order. What is the outlook for Airbus A320 aircraft values? “The Airbus A320-200 continues to be a crucial part of operator’s fleets worldwide and, as evidenced by the secondary market activity we observed in the second half of 2022, the A320-200 still retains a relatively high level of liquidity” says Hashen Hawawasam, Head of Commercial Aircraft Valuations. “IBA expects the A320-200 Market Value to Base Value relationship to stabilise in 2023. The A320-200 has begun its conversion program into a freighter aircraft with one A320-200P2F aircraft currently in service, owned by ST Engineering Aerospace and now operated by Pradhaan Air Express. Given the demand for narrowbody aircraft in recent months and the lack of supply of newer generation aircraft, IBA expect the value performance of the A320-200 to remain stable in 2023, with the potential for increases depending on the market supply and demand.” “In the long term, once the supply chain issues are resolved, more A320neo aircraft are expected to enter the market, particularly given that Airbus has ambitions to increase production rates in the years to come. This will inevitably replace A320-200 aircraft in large numbers thus causing a significant suppression in the values and lease rates of these aircraft. That said, we do expect to see some appetite in the P2F program (albeit limited to the number of conversions) but this will support the demand for engines and parts over a longer period.” IBA Insight flexibly illustrates multiple asset, fleet, and market positions, actual and potential, to inform client choices and identify acquisition opportunities. Immediate access to crucial aircraft, engine, lease rate and fleet data eases appreciation of historic and future aircraft concentrations and operator profiles.   Sign up for a system demo

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Introducing IBA’s New Engine Market Intelligence Reports

We are pleased to announce the launch of IBA’s first Engine Market Intelligence Reports. Combining our independently verified data from IBA Insight with IBA’s expert advisory opinion, these dynamic reports are simple, comprehensive, and regularly updated to reveal prevailing trends for major aircraft engine types. Our new engine reports complement our existing Aircraft Market Intelligence Reports, delivering the most holistic aviation intelligence on the market. What's included? Status, production, and retirements in the engine fleet Top in-service operators and engine models Common aircraft / engine combinations Engine types by airline Market values and lease rates Utilisation comparisons between engine types Backlog and delivery schedules Operator data and analysis Asset liquidity Expert commentary from our ISTAT-certified appraisers Download our sample report for the CFM LEAP-1A

a white and orange air india 787 passenger jet aircraft taking off with blue skies

Articles

What is the value of Air India’s Airbus and Boeing aircraft order?

We look at the likely value of Air India’s order in comparison to the list price, and examine the combined TATA group fleet today.

A Boeing 747 jumbo jet landing with wheels down with a sunset sky in the background

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The evolution of the Boeing 747 fleet - 1966-2023

Tuesday 31 January 2022 marks a pivotal moment in aviation history, the delivery of the last production Boeing 747. The aircraft, registered N863GT, is the 1,574th and final 747 to roll of the production line.

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Introducing Schedules Data to IBA Insight

We are delighted to announce that airline Schedules data powered by OAG is now available in our aviation intelligence platform, IBA Insight. This empowers our users to understand global and operator capacity like never before, with access to both historic schedules and future data, up to 12 months in advance.

a flybe dash 8 prop aircraft taking off in a blue sky

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Significant competition and high operating costs fuel the demise of Flybe

Exploring the factors that led to the second collapse of the British regional carrier.

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Airline Consolidation - the outlook for 2023

What types of operators and which global regions are most likely to see consolidation in 2023?

an md11 jet airliner aircraft on the ground at an airport with a blue sky behind

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On this Day in 1990 - First Flight of the MD-11

The McDonnell Douglas MD-11 made its first flight on 10 January 1990. We used IBA Insight to reveal the status of the global MD-11 fleet today.

Valuations

Articles

Could Saudi ambitions trigger a Middle East power play?

“My grandfather rode a camel. My father drove a car. I fly in jet planes. My son will drive a car. My grandson will ride a camel.” This contested quote relates to the desire to diversify away from an oil-export-dominant economy. Following Qatar and the UAE, it’s now a focus for Saudi Arabia. Aside from the emergence of Avilease last year with the announcement of a 12-aircraft SLB with flynas, the Saudi Public Investment Fund also launched Riyadh Air this week. This was closely followed by the $37Bn list price order for up to 121 x 787-9s to be split between the airline and Saudia. That’s a lot of capacity, and links closely with the Saudi vision to carry 330m passengers by the end of the decade (with close to a third visiting the country). Having spent much of my childhood in Riyadh and witnessing the speed of development, I have no doubt that they can succeed. Might this trigger a Middle Eastern power play whereby Emirates, Etihad and Qatar fight against the Saudi growth to destabilise the profitability for European and Asian carriers hoping to recapture market share? The combined carriers already have 465 passenger aircraft in active service, 95 parked or in storage, and 307 on backlog, I sense that, given their deep pockets, growth will proceed at any cost.

Singapore Airlines Plane on the run way taking off

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New generation widebody lease rates are rising

New generation widebody lease rates are rising with some lag and more subdued value gains, according to data revealed by Phil Seymour,  Mike Yeomans, and Jonathan McDonald in our recent webinar. The latest trends in new generation widebody aircraft values and lease rates. Source: IBA Insight. The Airbus A350-900 was at US$925,000 per-month in January 2021 with an increase to US$954,000 per-month in January 2023. We predict this will have risen to US$1,007,000 per-month by July 2023.   Base value movements are more varied for new generation widebody aircraft. The Boeing 7879, 787-10, Airbus A350-900 and A350-1000 continue to grow, whereas the 787-8 and A330-900 fell between 2019 and 2022 (but stabilised into 2023). The latest mid-life widebody aircraft value and lease rate trends. Source: IBA Insight The base value decline for mid-life widebody aircraft has eased with the prospect of some market value recovery through the first half of 2023. A 12-year-old A330-300 was valued at US$20.04 million in 2022, and is predicted to drop to US$19.967 million in 2023. Some mid-life widebody lease rates are increasing, with a 12-year-old B777-300ER sitting at US$314,000 per-month in October 2022 and predicted to rise to US$350,000 per-month by July 2023.  Don’t miss our latest webinars Stay tuned for our forthcoming webinars covering new and existing asset classes. In the coming months we be taking a deep dive into value trends for Engines, EVTOLs, business jets, helicopters, and freighters. Follow us on LinkedIn for updates on our next webinar.  Discover our market-leading aircraft valuations services IBA has one of the largest teams of certified senior appraisers in the industry. We provide independent advice on wide-ranging, complex asset valuation requirements. From strategic fleet selection, transaction due diligence, portfolio appraisal, and operational decision-making through to annual portfolio and financial compliance monitoring, we'll have you covered! IBA is proud to be the Appointed Appraiser for COMAC ARJ21 Programme.  Find out more about IBA Valuations

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Narrowbody aircraft values set to climb through 2023

New narrowbody aircraft base values rose beyond the long-term trend into 2023, and lease rates are forecast to climb further this year, according to data revealed by Phil Seymour, Mike Yeomans, and Jonathan McDonald in the first of our new series of valuations webinars.

An airplane wing with blue sky and clouds in the background

Articles

Key Trends for Global Aviation in 2023 - The IBA Perspective

In this short report, our experts Dr Stuart Hatcher, Geoff van Klaveren and Mike Yeomans share their expectations for the year ahead, examining macroeconomic factors, supply and demand, and challenges to airlines and aircraft values.

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Ask the Appraiser - How are Regional Jet and Turboprop aircraft values performing?

In the second edition of our ‘Ask the Appraiser’ webinars, our experts Jonathan McDonald and Phil Seymour examine the trajectory of regional jet and turboprop aircraft values, identifying the hottest trends and the impact of macroeconomic factors on the market.

An orange, red and white COMAC ARJ21 aircraft lifting off from a runway

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Ask the Appraiser - valuing the COMAC ARJ21

Our experts shine a light on the value and lease rate outlook for the ARJ21 and look at the wider market outlook for the Chinese regional jet.

A boeing 747-400 freighter aircraft on takeoff with a grey sky behind

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Ask the Appraiser: An Overview of the Freighter Market

In the first in our series of ‘Ask the Appraiser’ webinars, our experts Jonathan McDonald and Mike Yeomans examined the trajectory of freighter values, identified the hottest trends in P2F conversions, and explored the impact of macroeconomic factors on the air cargo market.

A black and white Airbus A350 passenger jet aircraft climbing into a blue sky with few cloudssky with wheels down

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Widebody aircraft values update – August 2022

IBA's expert team share the latest updates to widebody commercial aircraft values as part of our mid-year market update webinar.

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Narrowbody aircraft values update – August 2022

IBA's expert team share the latest updates to commercial aircraft values as part of our mid-year market update webinar.

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Regional aircraft engine values update - March 2022

The latest trends in regional aircraft engines you need to know, powered by IBA's InsightIQ.

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Which aircraft engines are most exposed to the Ukraine crisis?

IBA's insight has identified that engine lessors are far less exposed to the impacts of the Ukraine Crisis than aircraft lessors.

A view of an orange jet engine fitted to an EasyJet Airbus A320neo aircraft

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Utilisation driving greater value stability for narrowbody aircraft engines

The latest trends in narrowbody aircraft engines you need to know, powered by IBA Insight.

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Widebody aircraft value trends update - February 2022

IBA's InsightIQ has identified key widebody aircraft value trends, published in our latest aircraft values webinar.

A Lufthansa Airbus A320 jet aircraft on the ground at an airport

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Narrowbody aircraft value trends update - February 2022

IBA's InsightIQ has identified key narrowbody aircraft value trends, published in our latest aircraft values webinar.

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4 Top reasons to use IBA's Aircraft Market Intelligence Reports

IBA has launched new Aircraft Market Intelligence Reports, giving you best-in-class insight into prevailing and future aviation trends.

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Reviewing Airbus and Boeing Widebody Aircraft Values in 2021

IBA has recently updated InsightIQ with its latest widebody aircraft value opinions with respect to fixed-wing commercial passenger aircraft as of July 2021.

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Tracking Airbus and Boeing Narrowbody Aircraft Values in 2021

A review of narrowbody jet aircraft value trends in 2021

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Aircraft Values - Best Regional Aircraft of 2021

Regional air travel has proven a key driver in aviation recovery, but which jets and turboprops have performed best by value in 2021?

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Turboprop Aircraft Values Show Positive Trends

Using aviation intelligence fleet and values data from our InsightIQ platform, IBA has published adjustments to aircraft values across the global Turboprop fleet.

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Smaller Regional Jets Show Positive Value Adjustments

Using aircraft values data from our InsightIQ aviation intelligence platform, IBA has published adjustments to regional jet aircraft values in August/September 2021.

IBA NetZero

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IBA Sustainability Watch - September 2023

Welcome to IBA’s September Sustainability Watch Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net zero emissions, and their real-term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team share key insights and the latest news from the growing world of sustainable aviation.

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Sustainable Aviation Fuel: How sustainable is it really?

Luisa Barnes, Aviation Analyst - ESG [email protected] To tackle emissions from the aviation industry, at present, Sustainable Aviation Fuel (SAF) is a frequently discussed and relied upon prospect. While research shows SAF is a ‘win’ in theory, there are questions over the supposedly ‘sustainable’ alternatives that are often overlooked.

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IBA Sustainability Watch - August 2023

Welcome to IBA Sustainability Watch: August 2023 Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net zero emissions, and their real-term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team will be sharing key insights and the latest news from the growing world of sustainable aviation.

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Frequent Flyer Tax

Danny Thurtle, Aviation Analyst - ESG [email protected] Aviation demand analysis Claims surrounding the concentrated socioeconomic nature of air passenger demand are widespread. In North America in 2017/18, 19% of the population took 4 or more flights per year; accounting for a staggering 82% of all flights in the region[1]. The argument put forwards by those advocating for a frequent flyer levy (FFL) is that the small proportion of populations that fly regularly should be paying for the disproportionate impact they have on aviation’s emissions.

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IBA Sustainability Watch - July 2023

Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net-zero emissions, and their real term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team will be sharing key insights and the latest news from the growing world of sustainable aviation.

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IBA Sustainability Watch - June 2023

Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net-zero emissions, and their real term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team will be sharing key insights and the latest news from the growing world of sustainable aviation.

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What Does Global Temperature Rise Mean for Aviation

Luisa Barnes, Aviation Analyst [email protected] The Intergovernmental Panel on Climate Change (IPCC) recently published a report stating that climate change is set to breach the warming limit, set under the 2015 Paris Agreement. By the year 2027, they warn of a global 1.5°C temperature rise for the first time and a 2 in 3 chance that within the next five years, we’ll exceed the crucial 1.5°C threshold during a one-year period. So overall, the IPCC expects the next five years to be the hottest ever on record. What’s more, on top of the global warming from anthropogenic activities, it is probable that the oscillating weather system ‘El Niño’ will force temperatures to record levels and profound emission mitigation is urgently needed if we are to avoid irreversible damage.

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IBA Sustainability Watch - May 2023

Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net-zero emissions, and their real term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team will be sharing key insights and the latest news from the growing world of sustainable aviation.

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IBA Sustainability Watch - April 2023

Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net-zero emissions, and their real term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team share key insights and the latest news from the growing world of sustainable aviation.

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IBA Sustainability Watch - March 2023

The latest news and trends in sustainable aviation from IBA's ESG Consulting team

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IBA's Carbon Index - What Happened in December 2022?

IBA has published its latest aviation Carbon Index in partnership with KPMG. This time, we use IBA NetZero to shine a light on the EU ETS scheme and what it means for operators and portfolios.

A ryanair aircraft on the ground at an airport next to a fuel truck

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Carbon Index Spotlight on Airlines, Aircraft and Lessors - October 2022

IBA has published its latest aviation Carbon Index in partnership with KPMG. In our latest analysis, we use IBA NetZero to shine a light on regional attitudes to emerging CORSIA emissions regulation.

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Take your emissions analysis and mitigation strategies to the next level

Our aviation emissions intelligence platform is designed to give you breadth, accuracy, and analytical superpowers!

AN Air Transat Airbus A321neo aircraft on the ground at an airport with a blue sky in the background

Articles

New generation aircraft to drive further emissions efficiency improvements by 2025

IBA has published its latest aviation Carbon Index in partnership with KPMG. Our latest analysis leverages IBA NetZero's scenarios and projections to forecast the mix of emissions by aircraft type in 2025 based on expected retirements and deliveries.

Articles

Carbon Index Spotlight on Airlines, Aircraft and Lessors - August 2022

IBA has published its latest aviation Carbon Index in partnership with KPMG. Our latest analysis for August 2022 includes a spotlight on the most efficient airlines globally by region.

a boeing 747 jet passenger aircraft on takeoff with a blue sky in the background

Articles

Israeli 4 engine ban will most likely hit converted 747 freighters

Israel has announced the ban of four-engine aircraft in Israeli airspace, in an effort to reduce noise and air pollution. Whilst the ban is mandated to come into effect from March 2023, it is believed that operators may be discouraged from operating such aircraft even sooner.

Articles

3 key factors that drive global fleet efficiency

IBA's ESG Consultancy experts use IBA NetZero to regularly track the CO2 efficiency of the global commercial aircraft fleet.

Articles

Carbon Index Spotlight on Airlines, Aircraft and Lessors - July 2022

IBA has published its latest aviation Carbon Index in partnership with KPMG. Our latest analysis for June 2022 includes a spotlight on the efficiency of lessors, focussed on regional jets and turboprops.

An ANA Boeing 787 dreamliner sits at a gate at an airport surrounded by catering trucks and service vehicles

Articles

Ranked – the most efficient lessors in the Asia Pacific region

Aviation carbon emissions intelligence from IBA NetZero has revealed the most efficient major aircraft lessors in the Asia Pacific region on a CO2 per-seat per-mile basis.

Articles

Carbon Index Spotlight on Airlines, Aircraft and Lessors - June 2022

IBA has published its latest aviation Carbon Index in partnership with KPMG. Our latest analysis for June 2022 includes a spotlight on the efficiency of lessors in the APAC region.

Market Analysis

Articles

IBA Sustainability Watch - August 2023

Welcome to IBA Sustainability Watch: August 2023 Environmental, Social, and Governance (ESG) issues are now seen as a key risk to investments in aviation, and authorities across the world are demanding more transparency and stricter reporting standards. It’s never been more important to understand the pathways to net zero emissions, and their real-term impacts on all key players across the industry. Each month, IBA’s ESG Consulting team will be sharing key insights and the latest news from the growing world of sustainable aviation.

Articles

Global Airline Passenger Capacity to Surpass 2019 Levels in October, IBA Predicts

IBA’s latest Aviation Industry Barometer predicts that global passenger ASKs (available seat kilometres) will surpass 2019 levels by October 2023, having reached 95% of pre-pandemic ASKs in June 2023.

Articles

Indigo Order Paris Air Show 2023

IndiGo’s order of 500 aircraft has notably eclipsed Air India’s 470 aircraft order made only in February this year (although there was also an option for 70 aircraft). When added to IndiGo's substantial existing backlog, questions will arise whether the Indian market can accommodate this number of aircraft.

Articles

IBA Insight Shows Middle East Airlines Surpassing Pre-Pandemic Capacity

IBA’s latest Aviation Industry Barometer shows that Middle Eastern operators surpassed pre-pandemic capacity with ASKs at 103% in May 2023 compared to 2019 levels.

Articles

IBA's predictions for Paris Air Show 2023

IBA's Chief Economist, Dr. Stuart Hatcher reveals his insights and sales predictions for The Paris Air Show 2023.

Articles

3 Influential women in aviation history (you may not have heard of)

This International Women's Day, we asked the IBA team to highlight the achievements of 3 influential women who made their mark in aviation history, from Spitfires to Concorde.

Articles

One year on – what’s happened to Russian airline capacity?

Over a year has now passed since the start of the Russo-Ukrainian war, the introduction of sanctions, and the reciprocal closure of western, Russian, and Belorussian airspace to select foreign registered aircraft. This naturally posed a huge challenge to European, Asian, and Russian operators as they worked hard to recover from the Coronavirus pandemic. Finnair elected to use the polar route to reconnect services to Japan, and the southern route to Southeast Asia and China. Flight data from IBA Insight reveals that Finnair operates the same number of flights into Singapore and Tokyo today as they did in 2019, but with increased flight durations on each route of 13% and 31% respectively. The airline’s utilisation of the A350 (with its 300 min ETOPS certification) has helped the carrier adapt flexibly. By contrast, operators such as Scandinavian Airlines have elected to remove Japan from their network altogether and have resumed only 7% of Chinese flights to-date. How have Russian operators been affected by sanctions and airspace closures? Russian operators were, in fact, leading the way in post-pandemic recovery with domestic ASKs already 10% above the 2019 peak by August 2020 and 32% by August 2021. Most notably, domestic ASKs sat at 36% above peak 2019 levels in August 2022, following 4 months of sanctions! Whilst we anticipated domestic growth as a result of a big fall in international capacity, I would have expected the sanctions to have dented passenger traffic to a greater extent. Whilst IBA Insight reveals that flights have reduced by around 11% since 2021, we have also observed flexibility in the utilisation of the Russian fleet. Usage of the A319, 737-700 and 737 classics has reduced in favour of increased deployment of the A321. Furthermore, we have witnessed a 20% increase in the usage of widebody aircraft on domestic routes, placing more reliance on the A330 and 777-300ER, the latter of which has seen a 111% increase in flights. Russian operators halted passenger A350 operations in 2021, and these aircraft were largely grounded at the onset of sanctions. Which international destinations are Russian operators flying to? International Capacity was down by 79% in 2020, recovering to 44% below 2019 levels in 2021. This reduced again to 67% below 2019 levels following sanctions. The number of countries visited by Russian operators had dropped from around 80 to less than 30 by the summer of 2022. The most popular summer destinations for Russian travellers proved to be Turkey (37% of capacity), followed by Tajikistan, Uzbekistan, UAE and Kyrgyzstan (each with around 10% capacity). Winter destinations tell a different story. As of February 2023, Thailand tops the list with 19% of the capacity, followed by UAE with 15% and Turkey coming in third with just 10% (just 29% of summer 2022 capacity). Worthy mentions also include Egypt, Cuba, Sri Lanka, the Maldives, and India. These collectively account for 15% of winter capacity but <5% of summer 2022 capacity. Egypt is proving a noteworthy winner, with a 1300% increase in traffic to the country from Russia. This has been buoyed by limited options, and the 2021 lifting of the ban on direct flights to Egyptian resort cities following the crash of Metrojet flight 9268. Locations such as the UAE, Turkey, The Maldives and Sri Lanka are up 50-75% on 2019, whilst Russia’s largest winter sun location, Thailand, still has some ground to catch up. Myself and the team will continue to monitor and report on the evolving situation for Russian carriers and the impact on lessors and the wider aviation finance community. Don’t miss out on the latest aviation intelligence The IBA team share regular insights on all aspects of commercial aviation, from airline capacity and travel trends to aircraft values and ESG strategy. Sign up today to get the latest intelligence from the IBA Weekly newsletter delivered straight to your inbox. Sign up to our IBA Weekly

Articles

Latest financial results indicate a positive outlook for Delta and United

The latest financial results published by two of the ‘big four’ US carriers indicate a positive outlook moving into 2023.

Articles

Airline Consolidation - the outlook for 2023

What types of operators and which global regions are most likely to see consolidation in 2023?

Articles

Key Trends for Global Aviation in 2023 - The IBA Perspective

In this short report, our experts Dr Stuart Hatcher, Geoff van Klaveren and Mike Yeomans share their expectations for the year ahead, examining macroeconomic factors, supply and demand, and challenges to airlines and aircraft values.

A LATAM Boeing 787 Dreamliner jet aircraft landing on a runway at an airport with buildings in the background

Articles

Latin America leads global capacity recovery

IBA Insight has revealed that the Latin American region is leading global air traffic recovery, with capacity now exceeding pre-pandemic levels recorded in 2019.

Articles

Carbon Index Spotlight on Airlines, Aircraft and Lessors - August 2022

IBA has published its latest aviation Carbon Index in partnership with KPMG. Our latest analysis for August 2022 includes a spotlight on the most efficient airlines globally by region.

a loganair embraer jet taking off from an airport with sky and other airplanes in the background

Articles

Why Loganair is a unique prospect for it's next owners

IBA's Manager of Airline Analysis Neil Fraser shares his perspectives on the sale of Scottish carrier Loganair.

Articles

Transavia plan to utilise Airbus A320neo in France next year

IBA's Neil Fraser comments on Transavia's likely deployment of Airbus aircraft for summer 2023.

Articles

Israeli 4 engine ban will most likely hit converted 747 freighters

Israel has announced the ban of four-engine aircraft in Israeli airspace, in an effort to reduce noise and air pollution. Whilst the ban is mandated to come into effect from March 2023, it is believed that operators may be discouraged from operating such aircraft even sooner.

Articles

Widebody aircraft values update – August 2022

IBA's expert team share the latest updates to widebody commercial aircraft values as part of our mid-year market update webinar.

A group of passengers in a terminal building at an airport

Articles

3 challenges to continued air traffic recovery

Aviation intelligence from IBA Insight reveals 3 key challenges that are slowing the global recovery of air traffic.

Articles

Narrowbody aircraft values update – August 2022

IBA's expert team share the latest updates to commercial aircraft values as part of our mid-year market update webinar.

Articles

U.S. expected to approve inspection plans and allow resumption of 787 deliveries

It has been reported that the US Federal Aviation Administration (FAA) may have approved Boeing's inspection and modification plan for the 787-9 Dreamliner aircraft, which would allow the OEM to resume deliveries of the type.

passengers board a wizz air airbus a320 aircraft using a set of steps with mountains and a blue sky in the background

Articles

Airline capacity reduces by 16% amidst schedule cuts

In our recent Mid-Year Market Update webinar, our experts used IBA Insight to explore the impact of airline schedule cuts on capacity and mapped the likely trajectory for the coming months.

Passenger to Freighter Conversions

A digital rendering of an Embraer 190 passenger to freighter conversion aircraft in the livery of Nordic Aviation Capital (NAC)

Articles

Nordic Aviation Capital confirmed as launch customer for Embraer E-Jet freighters

What does the first order for E-Jet conversion slots mean for Embraer's freighter conversions?

A Boeing 737 jet cargo aircraft with it's cargo door open

Articles

Boeing 737-800 leads passenger to freighter fleet growth in 2022

Our recent webinar highlighted the aircraft types driving the growth in global passenger to freighter conversions.

An image of a cargo plane being loaded with freight

Articles

4 Key air cargo trends to watch for in 2022

Using a combination of data sources together with IBA's own research and leading InsightIQ aviation intelligence platform, we have identified 4 key trends that will define the performance of the air freight market in 2022.

A Boeing 767-300ER freighter aircraft operated by UPS airlines in flight with landing gear down

Articles

Which aircraft make the most cost-efficient freighter conversions?

Which commercial aircraft make the most cost-effective freighter conversions? We use InsightIQ to examine the state of play in the market.

An Amazon Prime Air Boeing 737-800BCF aircraft in flight with high lift devices and landing gear extended

Articles

Amazon Air Fleet Grows with E-Commerce Market Boom

Amazon's Prime Air operation commenced flights in 2016 when it secured the use of a single Boeing 767-200BDSF.

A Cathay Pacific Boeing 777-300 aircraft taking off from a runway

Articles

Older Widebody Aircraft Values Suffer Pandemic's Influence

IBA has adjusted base values for older widebody aircraft. Our analysis looks at the state of the market through the lens of two key aircraft types.

Articles

Can P2F Conversions fulfil the unprecedented demand for Global Air Cargo?

With the onset of the COVID-19 pandemic, airlines saw the majority (and in some cases all) of their passenger fleets grounded as various lockdowns came into force around world.

Articles

4 Key Drivers of Demand in the Global Air Cargo Market

As well the vital role it continues to play in supporting the global economy, the air cargo market is now becoming increasingly important in powering global COVID vaccine distribution.

Articles

The changing shape of the P2F conversion market

A new batch of P2F converted freighters is currently entering the market but what makes an aircraft appropriate for conversion? Here, IBA considers the factors influencing suitability and anticipates the market's likely direction.

Articles

A New Era of Widebody Freighters

For a number of years now the widebody freighter market has really been focused, in terms of ordering activity and building fleet numbers, on three types, the Boeing 767-300ER, Boeing 777F and Boeing 747-8F. These three types supplementing and/or replacing models such as the Boeing 747-400 and McDonnell Douglas MD-11, whether these be factory produced freighters or converted freighters. With production of the Boeing 747-8F expected to reach its conclusion in 2022 and Boeing 767-300ER feedstock winding down, attention inevitably turns to which types can fill the void, enter the Airbus A330P2F and Boeing 777-300ERSF.

image of an aeroplane flying above buildings

Articles

What Are the Current Utilisation Levels for the 777 Family and Predicted Attrition?

As you will be aware, the withdrawal of passenger capacity from the market has driven extraordinary demand for dedicated freighters. Some passenger aircraft have been temporarily converted and freight movements have strengthened. Using flight data from IBA's Intelligence platform InsightIQ, we can illustrate the utilisation of the 777 Boeing Family.

Articles

IBA's Freighter Market Outlook, November 2019

Following IBA's mid-year P2F market update, Jonathan McDonald, Senior Commercial Ageing Aircraft Analyst, revisits the market to provide insight into current freighter market characteristics. This short webcast session looks at the conversion programme, growth forecasts, conversion costs, values and leasing rates, feedstock and lastly our view on current topics such as the pickle fork AD and the New Generation Boeing 777-300ERBDSF programme.

Articles

What Will The Narrowbody Freighter Landscape Look Like In 2037?

IBA Report: issued March 2019 Jon Whaley, IBA's Freight Analyst, explores fleet composition, market share and growth opportunities for the P2F market.

image of an aeroplane engine being built in a factory

Articles

IBA's Freighter Conversion Whitepaper, January 2019

Freighter Conversions - capitalising on the resurgence in demand Freight volumes are continuing to trend on an upward trajectory and at a solid rate when compared to historical data. It should be noted however, that due to the inventory restocking cycle having concluded and manufacturing export orders remaining low, demand factors are lacking when compared to 2017. This paper looks at the current and future freighter market, production, routes into the market and takes a close look at a B737 conversion.

Articles

IBA Foresee 1000 P2F Conversions Being Required In The Next 17 years

According to IATA's March 2018 Freight Analysis report, global freight volumes slowed to a 22-month low, 1.7% year-on-year in March. This outcome represents the slowest pace of annual growth since the early part of 2016. The decline in growth can predominantly be attributed to the end of the restocking cycle which was one of the drivers behind the high growth figures. IATA have cautioned against reading too much into the most recent figures and expects growth of 4-5% overall for 2018.

Engines

Articles

Turbulence ahead for some regional aircraft engines, whilst others continue to outperform the market.

IBA's experts examine the latest trends in regional engine values and utilisation in our latest webinar 'IBA Insight - How are engine values performing?'.

Articles

Mature Widebody Engines Unlikely to Recover to Pre-Covid Levels

IBA's experts Jamie Davey and Phil Seymour took a deep dive into the latest trends in widebody engine values and utilisation in our latest webinar 'IBA Insight - How are engine values performing?'.

Articles

New generation narrowbody engine values surge beyond 2019 levels

IBA's experts Jamie Davey and Phil Seymour took a deep dive into the latest trends in engine values in our latest webinar 'IBA Insight - How are engine values performing?'.

Articles

Regional aircraft engine values update - March 2022

The latest trends in regional aircraft engines you need to know, powered by IBA's InsightIQ.

Articles

Which aircraft engines are most exposed to the Ukraine crisis?

IBA's insight has identified that engine lessors are far less exposed to the impacts of the Ukraine Crisis than aircraft lessors.

Articles

Utilisation driving greater value stability for narrowbody aircraft engines

The latest trends in narrowbody aircraft engines you need to know, powered by IBA Insight.

A view from the wing of a Boeing 747-400 aircraft showing wingtip and jet engines

Articles

Freighters buck the trend in latest widebody aircraft engine values

The latest trends in aircraft engines you need to know, powered by IBA Insight.

Articles

Freighter Engine Recovery leads over Passenger Aircraft Engines

Utilisation of freighter aircraft engines is leading over passenger, but such comparisons should be viewed in context, writes David Archer.

A close up view of a jet engine mounted on a Boeing 737

Articles

Narrowbody Aircraft Engine Value Trends Update - October 2021

IBA has reviewed and updated our forecasts for narrowbody aircraft trends in October 2021.

A jet engine mounted on the wing of an Airbus A330 aircraft on takeoff, with flaps and landing gear down

Articles

Widebody Aircraft Engine Value Trends Update - October 2021

IBA has reviewed and updated our forecasts for widebody aircraft engine trends in October 2021.

A close up view of an aircraft jet turbofan engine's fan blades

Articles

Aviation Intelligence - Tracking Narrowbody Engine Recovery

We analysed utilisation trends for the four most prominent engine families in the narrowbody market to track market recovery.

Articles

Aviation Intelligence - Demand for Engine Shop Visits Vital to Aviation Market Recovery

Whilst passenger demand is the key driver in the recovery of the aviation market as a whole, a core indication of health of the engine market is in shop visit demand. This can dictate value performance, lease demand, investor appetite and overall liquidity of the engine market.

Articles

Rolls Royce Commits to 100% Sustainable Aviation Fuel Capability for Civil Aircraft Engines

Rolls-Royce are to test all its civil aircraft engines currently in production to ensure their compatibility with 100%-sustainable aviation fuel by 2023.

Articles

Will Open Rotor Engines be the next great leap in Decarbonisation?

General Electric and Safran Group are to collaborate on development of a viable open rotor engine, 'RISE', destined to power narrowbody aircraft by the mid-2030's. The joint venture between the US and French aero engine giants intends to make workable a concept first touted in the 1970s. The open rotor engine dispenses with the traditional pod housing the fan blades seen on high bypass turbofan engines.

Articles

Sandstorm Fails to Blow China's Post-Covid Recovery Off Course: But Aviation Manufacturers Must Develop Equipment More Resistant to Harsh Conditions

Denesz Thiyagarajan, Engine Analyst, IBA Advisory, uses InsightIQ intelligence to explore the potential impact of weather conditions in Northern China on Engine performance and utilisation.

Articles

Will The Recent Pratt & Witney 4000-112 Engine Failure Have A Lasting Impact On Storage Levels For Older Pratt & Whitney-Powered 777 Aircraft Fleet?

In response to the uncontained engine failure of a United Airline Boeing 777-200 flight from Denver to Honolulu on the 20th February, IBA's analyst Jie Zhou uses InsightIQ Fleet and Flight data to consider the short and long term impact for the Fleet.

Image of an aeroplane wing and engine in the sky

Articles

Is There a Bright Future for Green Time Engines?

An aircraft or engine approaching its operational twilight years tends to require closer condition monitoring and increased maintenance investment. For many years, one option lessors and operators have used to achieve a good return on their asset is to part out the aircraft or engine for feedstock or to sell them into the aftermarket. Engines with little green time remaining are typically the best option for teardown.

Articles

Engine Shop Visit Demand

Pre-Covid, IBA forecast strong growth across the entire aftermarket: narrowbodies, widebodies and regional aircraft. There was an expanding fleet, heightened utilisation and increased demand for shop visits. The situation has evidently altered enormously and the most vulnerable assets, mature widebodies, will be the first to be withdrawn from shop visits.

Articles

Narrowbody Engine Market Performance

When it comes to recovery, the short haul market will be first and there are some positive signs, many engines re-entering service in North America, Europe and Asia. However, despite increased flight volumes and resultant higher engine utilisation, load factors remain low. Border restrictions persist across all regions and passenger confidence to travel continues to challenge.

Articles

What is the Impact of the 737 MAX Groundings on the LEAP-1B? November 2019

For CFMI, it would appear that the impact of the 737 MAX grounding has not been detrimental to the LEAP-1B. There remains a strong market outlook for this engine and looking at the Base Value, Half Life, it is performing well and is on par with competing engines in the market. As illustrated in the chart below, there has been no impact on values.

Aircraft Management

Articles

Could Saudi ambitions trigger a Middle East power play?

“My grandfather rode a camel. My father drove a car. I fly in jet planes. My son will drive a car. My grandson will ride a camel.” This contested quote relates to the desire to diversify away from an oil-export-dominant economy. Following Qatar and the UAE, it’s now a focus for Saudi Arabia. Aside from the emergence of Avilease last year with the announcement of a 12-aircraft SLB with flynas, the Saudi Public Investment Fund also launched Riyadh Air this week. This was closely followed by the $37Bn list price order for up to 121 x 787-9s to be split between the airline and Saudia. That’s a lot of capacity, and links closely with the Saudi vision to carry 330m passengers by the end of the decade (with close to a third visiting the country). Having spent much of my childhood in Riyadh and witnessing the speed of development, I have no doubt that they can succeed. Might this trigger a Middle Eastern power play whereby Emirates, Etihad and Qatar fight against the Saudi growth to destabilise the profitability for European and Asian carriers hoping to recapture market share? The combined carriers already have 465 passenger aircraft in active service, 95 parked or in storage, and 307 on backlog, I sense that, given their deep pockets, growth will proceed at any cost.

Articles

3 Challenges faced when returning stored aircraft to service

As the world's widebodies return to the skies, we explore the key challenges of RTS processes, and specific implications for widebody aircraft.

A group of Russian S7 airlines Airbus A320 jet airliner aircraft with airbridge steps attached at an airport

Articles

How many leased aircraft have returned from Russia?

How many leased aircraft have been recovered from Russia by aircraft leasing companies?

A Ural airlines Airbus A320 passenger jet on the ground at an airport with grass and sky in the background

Articles

How many aircraft are being illegally re-registered by Russian airlines?

We take a look at how many aircraft have been re-registered in Russia to circumvent sanctions on Russian aviation.

Articles

Can P2F Conversions fulfil the unprecedented demand for Global Air Cargo?

With the onset of the COVID-19 pandemic, airlines saw the majority (and in some cases all) of their passenger fleets grounded as various lockdowns came into force around world.

Articles

Is the clock ticking for Power by the Hour deals?

The last year has, even for the aviation industry, been very unusual; traumatic, in fact, for some businesses. The number of high-profile insolvencies at a time of very low demand for aircraft has given rise to a situation where the usual recourse available to lessors, that is repossession of aircraft and then re-leasing or selling the asset, is not available. As IBA reported in October 2020, this environment has resulted in a substantial increase in the number of PBH arrangements being negotiated as an alternative to repossession by lessors and/or rejection or abandonment by airlines. Will the demand for PBH deals persist as the aviation market recovers?

Articles

Airport Landing Slot Values; Heathrow Pre- and Post-Covid and the Battle for Airport Slots

Senior Aviation Analyst Youcef Berour Minarro investigates the airport slot market, the impact of Covid-19 at London Heathrow, and the outlook for future slot values. This paper has been prepared to give an overview and insight into the current airport slot market, with specific emphasis on LHR as one of the most traded airports in the world. This article will review the impact COVID has had on LHR and what the IATA slot waiver extensions mean for slot values. IBA are one of only a very few appraisers recognised for airport slot valuations having completed a variety of assignments at airports including London LHR, London Gatwick and New York JFK. In 2015, IBA was involved in Europe's first ever bond tied to airport slots where Virgin Atlantic Airways secured a £220 million secured note transaction using the airline's take-off and landing slots at London Heathrow Airport. The bond was used to invest in new Boeing 787-9 aircraft. The bond had a tenor of 15 years. The notes were split between two tranches: £190 million A1 notes and £30 million A2 notes. The A1 notes have a weighted average life of 12 years, while the A2 notes have a weighted average life of 10 years. This was the first time in European air travel history that airport slots have been leveraged in this way, claiming the Deal of the Year in 2016. In 2020 alone, IBA have been heavily involved in performing a range of valuations for various purposes including slots securitisations, balance sheet purposes and for disposal/acquisition of slots. Download the full report

Articles

Managing Your Aircraft Asset in a Lockdown Situation

The traditional asset management practice of a financier or lessor performing an annual inspection of an aircraft and its records has been severely impaired since the pandemic took a grip of the World.

image of Norwegian airlines flying over snowy mountains

Articles

What Will Transatlantic Flights Look Like Post-Recovery?

In mid-January 2021, Norwegian announced it will refocus its operations on European routes and cease long-haul operations as part of its plans to exit the insolvency court. Ever since it started servicing routes between Europe and the United States with its fleet of 32 Boeing 787s, the airline became known for offering customers the opportunity to travel on modern and fuel-efficient aircraft very cheaply.

Articles

Power by the Hour Lease Rates

What are PBH lease rates and are they a good thing? The origins of PBH are from the 1960's when Rolls Royce leased engines by the hour to airlines. Aircraft leasing PBH has appeared before, more often for a short term if an airline was subject to seasonal fluctuations in traffic. Forward 60 years and PBH agreements are trending once again with more and more airlines seeking additional support from lessors. This short article looks at both the benefits and the shortcomings of the PBH revival.

Articles

Preparing Stored Aircraft For Return To Service (RTS)

The grounding of hundreds of aircraft in the last 7 or 8 months has led to a wave of issues concerning extended periods of parking and storage.

Articles

Preparing the 737 MAX for its return to service (RTS)

The grounding of Boeing's troubled 737 MAX programme over 16 months ago had an enormous impact on the global aviation industry. Operators, lessors and airports were all impacted by the consequences as well as Boeing themselves. New flight control software has been developed in relation to the, much talked about, Manoeuvring Characteristics Augmentation Systems (MCAS) and a welcome recertification process is now possible. We can allow ourselves to realistically envisage a much-needed conclusion to the aircraft's grounding by Q3 or Q4 2020.

Articles

Have operating lease agreements evolved with the industry? February 2020

Two fundamental situations have prompted IBA Group and Split Rock Aviation to reflect on some key 'industry standard' provisions within aviation lease agreements and re-evaluate their applicability and relevance: the 737 Max's grounding and the continued growth of leased aircraft in the industry. With the proportion of commercial aircraft leased now at 44% compared with 56% owned according to IBA's intelligence platform IBA.iQ, and witnessing the aviation industry's handling of the 737 Max's grounding, we have produced the first in a series of articles considering today's operating lease agreement. This segment will assess several industry standard lease agreement positions and test their logic in the current market.

image of an aeroplane flying through the sky

Articles

Revisiting Redeliveries in 2019

Poorly managed redeliveries are a staggering waste of money. Every narrowbody and widebody whose redelivery is inefficiently handled can cost $USD 2 million and $USD 4.5 million respectively. Putting that into context, the unnecessary expenditure would be enough to fund six to eight months' lease rental for each aircraft, a Heavy C Check, or even an engine shop visit.

image of a man inspecting the underside of a small aircraft

Articles

Why Regular Inspections Are A Good Idea, October 2018

As you would expect, aircraft and engines that are well looked after, maintained and inspected regularly will inherently hold their value more than those that are less well managed. To protect and maximise the value of an aircraft or engine, inspections are an essential element of asset management. A thorough inspection should always include an examination of the metal and its associated technical records, since it is the combination of the physical condition and historical records that create the overall value.

Repossessions

Articles

3 Challenges faced when returning stored aircraft to service

As the world's widebodies return to the skies, we explore the key challenges of RTS processes, and specific implications for widebody aircraft.

Articles

How many leased aircraft have returned from Russia?

How many leased aircraft have been recovered from Russia by aircraft leasing companies?

Articles

What is the future for Stobart Air's ATR fleet?

Stobart Air ceased operations on Saturday 12th June 2021. A regional carrier operating flights across the UK and Ireland, the Stobart Air fleet consisted of 12 ATR72-600 aircraft and one ATR42-600 aircraft according to data from IBA's InsightIQ platform.

Articles

3 Impacts of Covid-19 on Aircraft Repossession and Remarketing Timelines

IBA's Phil Seymour investigates 3 key impacts that Covid-19 has had on the speed and efficiency of aircraft repossession and remarketing. This information was taken from IBA's submission to the report 'Aircraft Repossession Planning - Practical Considerations' produced for Internal Comparative Legal Guides (ICLG) 2021.

image of 2 men with paperwork walking away from an aeroplane

Articles

The Technical Records Of Your Assets: How Would You Fare In A Friendly Hand Back Or Repossession Situation?

A complete and concise set of service records, properly identifying all required maintenance and modification events, is the indication of an aircraft's condition and the quality of its continuing airworthiness management. It clearly demonstrates the aircraft's compliance with all appropriate safety and lease requirements and its suitability for flight. Service records are essential if the aircraft is to be sold at its maintenance adjusted value or placed on lease with a new lessee.

Articles

Covid-19 Drives Aircraft Oversupply And Reductions In Airline Fleet Sizes, May 2020

As many of you will know, the effects of Covid-19 are going to change the size and makeup of airline fleets, and do so quickly. In the next 20 months, it's possible that many older aircraft types could be universally withdrawn from service, along with significant numbers of older variants of current generation aircraft including the Boeing 777, A330 and A380. IBA, the leading aviation consultancy, estimate there will be an aircraft oversupply of up to 2,500 narrow and widebody aircraft in the market, with global demand, once the current restrictions are lifted, possibly declining by 20% by the end of 2021.

image of the underside of an aircraft at an airport

Articles

IBA's Redelivery Whitepaper: The Picture in 2018

IBA recently updated its analysis around overspend in relation to redeliveries. As the infographic on page 9 highlights, overspends have increased since 2016, with engine costs being the key driver.

Transitions

Articles

3 Challenges faced when returning stored aircraft to service

As the world's widebodies return to the skies, we explore the key challenges of RTS processes, and specific implications for widebody aircraft.

A view of a narrowbody aircraft cabin, featuring aircraft seats and passengers

Articles

Narrowbody Aircraft Reconfiguration Trends

We investigated aircraft reconfiguration trends through the lens of two narrowbodies, the Boeing 737-800 and Airbus A320.

An interiorview of a widebody aircraft cabin, with rows of aircraft seats and in flight entertainment screens

Articles

Widebody Aircraft Reconfiguration Trends

We examined widebody aircraft reconfiguration to identify key trends for popular Airbus and Boeing types.

Articles

Is the clock ticking for Power by the Hour deals?

The last year has, even for the aviation industry, been very unusual; traumatic, in fact, for some businesses. The number of high-profile insolvencies at a time of very low demand for aircraft has given rise to a situation where the usual recourse available to lessors, that is repossession of aircraft and then re-leasing or selling the asset, is not available. As IBA reported in October 2020, this environment has resulted in a substantial increase in the number of PBH arrangements being negotiated as an alternative to repossession by lessors and/or rejection or abandonment by airlines. Will the demand for PBH deals persist as the aviation market recovers?

Articles

Economic Crises and Average Aircraft Downtime Between Lease End Events and Placements; Can the Industry Maintain Downtime's Falling Trend During and After Covid-19?

In recent years, the number of aircraft involved in lease end transactions has been increasing in line with growth of the global aircraft fleet. The volume of aircraft connected with operator failures has also risen over the last couple of years.

Articles

Covid-19 Drives Aircraft Oversupply And Reductions In Airline Fleet Sizes, May 2020

As many of you will know, the effects of Covid-19 are going to change the size and makeup of airline fleets, and do so quickly. In the next 20 months, it's possible that many older aircraft types could be universally withdrawn from service, along with significant numbers of older variants of current generation aircraft including the Boeing 777, A330 and A380. IBA, the leading aviation consultancy, estimate there will be an aircraft oversupply of up to 2,500 narrow and widebody aircraft in the market, with global demand, once the current restrictions are lifted, possibly declining by 20% by the end of 2021.

image from inside an aeroplane, from the back looking forward

Articles

Aircraft Interiors During Lease Return: The Inside Story, February 2020

Why were commercial passenger aircraft ever invented, built, bought and sold or operated? The clue's in the name: the passenger. Many if not most travellers spare scant thought to the feats of engineering behind an aircraft's take-off and landing, not to mention keeping it airborne in between. What they will notice and expect when flying, however, is how the aircraft looks inside and whether it is clean, tidy and comfortable. So, having interiors in the best condition throughout the life of an aircraft is paramount for most operators.

Articles

Revisiting Redeliveries in 2019

Poorly managed redeliveries are a staggering waste of money. Every narrowbody and widebody whose redelivery is inefficiently handled can cost $USD 2 million and $USD 4.5 million respectively. Putting that into context, the unnecessary expenditure would be enough to fund six to eight months' lease rental for each aircraft, a Heavy C Check, or even an engine shop visit.

Articles

Why Regular Inspections Are A Good Idea, October 2018

As you would expect, aircraft and engines that are well looked after, maintained and inspected regularly will inherently hold their value more than those that are less well managed. To protect and maximise the value of an aircraft or engine, inspections are an essential element of asset management. A thorough inspection should always include an examination of the metal and its associated technical records, since it is the combination of the physical condition and historical records that create the overall value.

Articles

IBA's Redelivery Whitepaper: The Picture in 2018

IBA recently updated its analysis around overspend in relation to redeliveries. As the infographic on page 9 highlights, overspends have increased since 2016, with engine costs being the key driver.

image of a man building an aircraft engine

Articles

How do OEM Engine Maintenance Contracts Affect the Ability to Remarket Aircraft? September 2017

Aviation commentators have often remarked on the increasing presence of OEMs in the engine aftermarket. This is especially the case when it comes to engine maintenance, and the declining independent MRO solutions available. OEM maintenance contracts offer maintenance stability for operators, but can the widespread adoption of these affect resale values or leasing demands? Charlotte Daniels provides an assessment.

Helicopters

Articles

Aviation Intelligence - India's First Gift City Leasing Company

Vman aviation services have launched in India. Read our analysis of the first aircraft leasing company in the 'Gift City'.

Image of a Helicopter flying at an angle

Articles

How is Covid-19 Impacting the Helicopter Market Worldwide? June 2020

IBA's Alastair Fallon, Helicopter Aviation Analyst, joined the Helicopter Investor Town Hall Forum on Tuesday 9th June. Within the 60-minute session, the panel of industry experts assessed the health of the helicopter market and discussed how Covid-19 is affecting the different heli markets worldwide.

Articles

Will Covid-19 and Oil Price Cuts Send the Helicopter Market into a Spin?

The WHO has declared the spread of Coronavirus (Covid-19) a global pandemic and we are all bearing the brunt of an information overload from multiple sources via the media advising us how to live, work and travel. BA today announced it will cancel 75% of its flights with Easyjet grounding 100 of its 344 aircraft across Europe. Scheduled and charter fixed wing passenger flights the world over cannot operate.

Articles

How Will the Helicopter Market Evolve In 2019?

With the current levels of turmoil and change in the helicopter sector, IBA is regularly being asked challenging questions about the future of the market. Owen Geach, IBA's Chief Commercial Ofﬁcer takes a look at the future of leasing in the helicopter market.

Business Jets

Articles

IBA's Business Jet Market Report January 2022

The global business jet fleet numbers almost 23,000 operational aircraft. With the abnormalities seen in business aircraft supply and demand since the start of the Coronavirus pandemic having a significant effect on the market, IBA's Business Jet report shine a light on current market trends in business aircraft. Some key takeaways include: Though slow and cautious at the start of the pandemic, the Bizjet market has proven resilient andprosperous whilst wider commercial aviation has suffered There is high demand for business jets, and we find ourselves in a fast-paced environment in 2022 This high demand, coupled with low supply, has led to a seller's market Inflated Bizjet values are likely to return to normal as commercial aviation continues to recover ESG targets are likely to prove a key challenge to the market over the coming years Download the full report

Lease Rates

Articles

New generation widebody lease rates are rising

New generation widebody lease rates are rising with some lag and more subdued value gains, according to data revealed by Phil Seymour,  Mike Yeomans, and Jonathan McDonald in our recent webinar. The latest trends in new generation widebody aircraft values and lease rates. Source: IBA Insight. The Airbus A350-900 was at US$925,000 per-month in January 2021 with an increase to US$954,000 per-month in January 2023. We predict this will have risen to US$1,007,000 per-month by July 2023.   Base value movements are more varied for new generation widebody aircraft. The Boeing 7879, 787-10, Airbus A350-900 and A350-1000 continue to grow, whereas the 787-8 and A330-900 fell between 2019 and 2022 (but stabilised into 2023). The latest mid-life widebody aircraft value and lease rate trends. Source: IBA Insight The base value decline for mid-life widebody aircraft has eased with the prospect of some market value recovery through the first half of 2023. A 12-year-old A330-300 was valued at US$20.04 million in 2022, and is predicted to drop to US$19.967 million in 2023. Some mid-life widebody lease rates are increasing, with a 12-year-old B777-300ER sitting at US$314,000 per-month in October 2022 and predicted to rise to US$350,000 per-month by July 2023.  Don’t miss our latest webinars Stay tuned for our forthcoming webinars covering new and existing asset classes. In the coming months we be taking a deep dive into value trends for Engines, EVTOLs, business jets, helicopters, and freighters. Follow us on LinkedIn for updates on our next webinar.  Discover our market-leading aircraft valuations services IBA has one of the largest teams of certified senior appraisers in the industry. We provide independent advice on wide-ranging, complex asset valuation requirements. From strategic fleet selection, transaction due diligence, portfolio appraisal, and operational decision-making through to annual portfolio and financial compliance monitoring, we'll have you covered! IBA is proud to be the Appointed Appraiser for COMAC ARJ21 Programme.  Find out more about IBA Valuations

Articles

Is the clock ticking for Power by the Hour deals?

The last year has, even for the aviation industry, been very unusual; traumatic, in fact, for some businesses. The number of high-profile insolvencies at a time of very low demand for aircraft has given rise to a situation where the usual recourse available to lessors, that is repossession of aircraft and then re-leasing or selling the asset, is not available. As IBA reported in October 2020, this environment has resulted in a substantial increase in the number of PBH arrangements being negotiated as an alternative to repossession by lessors and/or rejection or abandonment by airlines. Will the demand for PBH deals persist as the aviation market recovers?

Articles

Power by the Hour Lease Rates

What are PBH lease rates and are they a good thing? The origins of PBH are from the 1960's when Rolls Royce leased engines by the hour to airlines. Aircraft leasing PBH has appeared before, more often for a short term if an airline was subject to seasonal fluctuations in traffic. Forward 60 years and PBH agreements are trending once again with more and more airlines seeking additional support from lessors. This short article looks at both the benefits and the shortcomings of the PBH revival.

Articles

Depressed Outlook for 737 MAX Lease Rates

Whilst 737 MAX sale and leaseback rates look set to strengthen in the near term, the future looks bleak for direct lease rates. As far back as the mid 2018s, lessors were experiencing difficulty placing the MAX, resorting to placements with weaker credit airlines at increasingly softer rates. By the end of the 2018s, rates had dipped as low as $270,000 - $280,000 and, as 2019 dawned, even before its grounding many lessors and operators were questioning the MAX's value against the comparative attraction of its 737-800 sibling.

Articles

Historical Lease Rate Performance - 777-300ER. January 2020.

As production draws to a close and the line moves over to the 777X, IBA's award winning appraisal team looks at the long term Lease Rate Performance for the 777-300ER. As of 30th January 2020, IBA's data intelligence platform IBA.iQ shows the 777-300ER fleet with 800 active aircraft, 18 parked/stored/damaged and 37 on backlog with zero part-outs.

Articles

IBA's Lease Rate Analysis - A330-300. December 2019

The widebody leasing market is less fluid than that for narrowbodies and is heavily controlled by sale leasebacks for new deliveries. The market started its recovery from a post 9/11 slump in 2003 and this resurgence was affected by the global financial crisis only slightly. Since 2015, however, excess capacity has exerted immense pressure on rates in the market. Bankruptcies, fleet management decisions and lease ends, particularly young lease ends, have each played a part.

Articles

Historical Lease Rate Performance - A320ceo v 737-800. December 2019

Historically, new delivery market lease rates have correlated well with 5-year swap rates, usually with a 6 to12-month lag. However, recent IBA research revealed that, despite rate increases since 2016, market lease rates have in contrast declined. We examined lease performances of the A320ceo and 737-800 both when new and at 10 years and summarise our key findings as follows:

image of graphs and data with a hand holding a pen

Articles

How Low Will A330 Lease Rates Go?

The A330ceo is now in its replacement phase. Secondary market availability and storage are relatively high and the A330-200 in particular has been in oversupply for some time. Powered by IBA.iQ, our advisory teams have seen lease rates soften in recent years. The wave of pre-GFC delivered aircraft have returned from their initial leases which has put downward pressure on rentals in the market.

image of a man looking inside an aircraft engine

Articles

What to Look for When Valuing an Engine, March 2018

Determining the value of an engine at different phases of its life-cycle requires consideration of a variety of factors, particularly engine maintenance value and engine core value. Depending on the phase of the engine's life, options to the owner include repair or overhaul to put value back into the asset; or, alternatively, green-time sale, tear-down and part-out of used serviceable material in order to extract remaining value from the engine. Maintenance value accounts for the value of life-limited parts (LLPs) and the value associated with the on-wing time before requiring a performance restoration.

Articles

IBA's Redelivery Whitepaper: The Picture in 2018

IBA recently updated its analysis around overspend in relation to redeliveries. As the infographic on page 9 highlights, overspends have increased since 2016, with engine costs being the key driver.

Airline Credits

Articles

Aviation Intelligence - Does a Global Crisis Drive Airline Start-ups?

While it is becoming clear that the post-pandemic market is providing an opportunity, are global crises in general a breeding ground for brave and bold start-ups?

A man behind a screen of data, reaching to touch a plane

Articles

What is the Future of Korean Aviation Post Covid and is There the Potential of a Monopoly Mega Airline?

2021 started weakly for the Korean aviation market, revenue passenger kilometres (RPKs) in January were 72% lower than the same month in 2019 according to IATA and our own InsightIQ Flights analysis. In this detailed report, Finlay Grogan, IBA airlines analyst, uses InsightIQ data to research and evaluate Korean airline performance, including financial reviews, fleet structures, utilisation levels, carbon emissions and future performance and consolidations.

drawing of an aeroplane flying down to the right followed by a trail left behind

Articles

How Will Enduring Flight Restrictions Cloud Performance Of Wizz Air's Planned Schedule?

The pandemic's disruption of planned airline operations has returned in recent weeks, a number of countries in Western Europe entering their second lockdown of the year. In this short piece, we leverage Flight data from IBA's powerful new intelligence platform, InsightIQ, to examine the extent to which Wizz Air (UK & Hungary) has fulfilled its published schedule.

Articles

Failure Rates For Airlines Has Remained Flat To The End Of October But What Does The Future Hold?

Using InsightIQ's analytics, in this analysis we have focused on airlines with aircraft having more than 25 seats and the primary concern is with fixed costs. A combination of cash reserves, payment holidays and government aid is being used for survival. Inevitably, as the crisis persists, the ability to repay debt becomes more remote.

Articles

Will Government Support Stave Off Second Wave Operator Casualties?

Using IBA's Operator Score for a sample of operators, we spotlight COVID-19's influence on the aviation industry and analyse government support for airlines as a proportion of their net profit, comprehensive margin and cash position. Below, IBA shares its opinion on government intervention to help airlines overcome the risks associated with COVID-19's downturn.

Articles

Q3 of 2020 Will Bring More Airline Failures Once Lifelines and Cash Reserves are Depleted

Using data from IBA.iQ, the chart below illustrates the impact of the current crisis on airline failure rates. For 2020, failures have intensified and survival of the fittest now depends on factors such as cash reserves, payment holidays and government aid until such time as the market re-opens and passenger demand returns.

image of graphs and data being presented

Articles

IBA's Operator Risk Assessment - Aerolineas Argentinas December 2019

Full visibility of an asset's performance and value is essential in order to maximise returns. Oversupply, residual concerns and high fuel prices are all contributing to a more fluid picture than in recent years, making asset selection more critical.

Coronavirus (Covid-19)

Articles

3 Challenges faced when returning stored aircraft to service

As the world's widebodies return to the skies, we explore the key challenges of RTS processes, and specific implications for widebody aircraft.

An image showing a yellow Spirit Airlines Airbus A320neo aircraft on the ground at an airport

Articles

Low cost airline capacity to grow past pre-Covid levels in 2022

IBA has forecasted a sharp recovery in capacity and demand in our recent commercial aviation market update.

Articles

Airline Industry Analysis: The Impact of Oil Prices & Coronavirus

The historic correlation between high oil prices and airline failures is a proven trend. Combined with Coronavirus, they represent a clear and present danger to airlines.

Articles

Aviation Trends: Booking Spike Shows High Demand For Travel

Data from IBA's InsightIQ platform has revealed strong regional variations in flight data and recovery of load factors.

Articles

3 Impacts of Covid-19 on Aircraft Repossession and Remarketing Timelines

IBA's Phil Seymour investigates 3 key impacts that Covid-19 has had on the speed and efficiency of aircraft repossession and remarketing. This information was taken from IBA's submission to the report 'Aircraft Repossession Planning - Practical Considerations' produced for Internal Comparative Legal Guides (ICLG) 2021.

Articles

Sandstorm Fails to Blow China's Post-Covid Recovery Off Course: But Aviation Manufacturers Must Develop Equipment More Resistant to Harsh Conditions

Denesz Thiyagarajan, Engine Analyst, IBA Advisory, uses InsightIQ intelligence to explore the potential impact of weather conditions in Northern China on Engine performance and utilisation.

Articles

Airport Landing Slot Values; Heathrow Pre- and Post-Covid and the Battle for Airport Slots

Senior Aviation Analyst Youcef Berour Minarro investigates the airport slot market, the impact of Covid-19 at London Heathrow, and the outlook for future slot values. This paper has been prepared to give an overview and insight into the current airport slot market, with specific emphasis on LHR as one of the most traded airports in the world. This article will review the impact COVID has had on LHR and what the IATA slot waiver extensions mean for slot values. IBA are one of only a very few appraisers recognised for airport slot valuations having completed a variety of assignments at airports including London LHR, London Gatwick and New York JFK. In 2015, IBA was involved in Europe's first ever bond tied to airport slots where Virgin Atlantic Airways secured a £220 million secured note transaction using the airline's take-off and landing slots at London Heathrow Airport. The bond was used to invest in new Boeing 787-9 aircraft. The bond had a tenor of 15 years. The notes were split between two tranches: £190 million A1 notes and £30 million A2 notes. The A1 notes have a weighted average life of 12 years, while the A2 notes have a weighted average life of 10 years. This was the first time in European air travel history that airport slots have been leveraged in this way, claiming the Deal of the Year in 2016. In 2020 alone, IBA have been heavily involved in performing a range of valuations for various purposes including slots securitisations, balance sheet purposes and for disposal/acquisition of slots. Download the full report

Articles

The Evolving Structure of Japan's Aviation Market

Lewis Leslie, Senior Aviation Analyst, IBA Advisory, uses InsightIQ Fleets and Values intelligence to explore the structure of the Japanese aviation market. Executive Summary 19% of the Japanese in-service aircraft fleet remains either parked or stored. Aircraft utilisation by Japanese airlines has not yet recovered to pre-Covid levels, in line with global utilisation trends. However, the Japanese aviation market is robust and well-placed for growth opportunities in the Asia-Pacific region in coming years. Large scale fleet renewal is expected within the next 10 years, but the rate of replacement is uncertain due to delays to the Boeing 737 MAX. Sale and Leasebacks accounted for the majority of secondary market transactions in 2020 through to March 2021, with nine recorded. The volume of JOLCO transactions fell last year but is expected to recover as demand for new aircraft returns.

Articles

Will The Embattled DHC8-400Q Fleet Survive Covid-19?

Finlay Grogan, an aviation analyst at IBA advisory, looks back at the historic performance of the DHC8-4000 fleet and how the programme has been challenged in more recent times. What does the future hold for this Canadian built aircraft?

Articles

China's Strong Domestic Air Travel Has Stalled Over The Lunar New Year

InsightIQ data revealed China has experienced a drop in domestic air travel in the fifteen-day period prior to the Lunar New Year compared to the same period in 2020. Following the resurgence of new Covid-19 cases in early January, new travel restrictions and subsequent lower demand for domestic travel have meant deep capacity cuts from local airlines.

Articles

Managing Your Aircraft Asset in a Lockdown Situation

The traditional asset management practice of a financier or lessor performing an annual inspection of an aircraft and its records has been severely impaired since the pandemic took a grip of the World.

Articles

Key Aviation Themes For 2021: Where To Find Signs Of Optimism

In our 2021 forecast for the year ahead, Dr Stuart Hatcher, Chief Revenue Officer at IBA, shares IBA's opinion on traffic, transactions, asset values and airline failures in 2021. 'Now that 2020 is behind us, we can begin to look forward to 2021 and beyond; we can consider whether there are signals we can be optimistic about. A long, slow vaccination process is underway but, although this is a positive development, when do we realistically foresee the current market's harsh conditions will start to ease?'

Articles

What Will Transatlantic Flights Look Like Post-Recovery?

In mid-January 2021, Norwegian announced it will refocus its operations on European routes and cease long-haul operations as part of its plans to exit the insolvency court. Ever since it started servicing routes between Europe and the United States with its fleet of 32 Boeing 787s, the airline became known for offering customers the opportunity to travel on modern and fuel-efficient aircraft very cheaply.

Articles

US Airlines Record Strong Increase In Capacity

Using data from IBA's intelligence platform InsightIQ, we can research and analyse flight data to show changing trends in capacity across regions, operators, city pairs and by aircraft type.

image of an aeroplane wing blocking the sun behind

Articles

Aircraft Fleet Evolution - Lufthansa and Delta

Using fleet data from IBA's intelligence platform InsightIQ, it's possible to review how airline fleets are evolving and changing over time. Using Lufthansa and Delta as examples, our analysts explore and illustrate the size of the in-service fleet in January 2020 compared to 2021.

Articles

What Are the Current Utilisation Levels for the 777 Family and Predicted Attrition?

As you will be aware, the withdrawal of passenger capacity from the market has driven extraordinary demand for dedicated freighters. Some passenger aircraft have been temporarily converted and freight movements have strengthened. Using flight data from IBA's Intelligence platform InsightIQ, we can illustrate the utilisation of the 777 Boeing Family.

Articles

Will Blue Skies Greet Flybe's Re-Emergence?

Flybe was one of the earliest airline victims of the Coronavirus pandemic, ceasing commercial operations in March 2020. With recent news of a potential revival, IBA explores the former Flybe fleet in terms of redeployment, asset value and the status of the restart.

Articles

High Aircraft Storage Levels Will Continue Throughout 2021

The shocking outbreak of the Covid-19 pandemic at the beginning of 2020 initiated events that would rock the commercial aviation industry and guarantee the restructuring of even the largest airlines.

Image of plane tracking data on a world map

Articles

Will a Covid-19 vaccine change what's in store for the A380?

The Airbus A380 is one of the aircraft types worst affected by the Coronavirus pandemic, 87% of the fleet currently parked or stored according to InsightIQ, IBA's online intelligence platform. The following chart illustrates the A380's present fleet status:

Articles

Failure Rates For Airlines Has Remained Flat To The End Of October But What Does The Future Hold?

Using InsightIQ's analytics, in this analysis we have focused on airlines with aircraft having more than 25 seats and the primary concern is with fixed costs. A combination of cash reserves, payment holidays and government aid is being used for survival. Inevitably, as the crisis persists, the ability to repay debt becomes more remote.

Aftermarket & Parts

A group of Aeroflot aircraft at the gates of Moscow airport

Articles

How long can Russian airlines maintain their aircraft?

IBA's experts examine how long Russian operators can keep aircraft flying with a limited supply of parts.

Articles

Freighters buck the trend in latest widebody aircraft engine values

The latest trends in aircraft engines you need to know, powered by IBA Insight.

Articles

Is There a Bright Future for Green Time Engines?

An aircraft or engine approaching its operational twilight years tends to require closer condition monitoring and increased maintenance investment. For many years, one option lessors and operators have used to achieve a good return on their asset is to part out the aircraft or engine for feedstock or to sell them into the aftermarket. Engines with little green time remaining are typically the best option for teardown.

image of a graph and data on the screen with US dollars over the top

Articles

How Has Covid-19 Affected Material Fair Market Values?

This month Adil Slimani, IBA's Head of Aftermarket Advisory shares his opinion on Covid and material Fair Market Values. 'Unprecedented' and 'Covid' have become synonymous with 2020 and the pandemic's tragic human cost has been the gravest many have experienced in generations. Numerous industries have also suffered and aviation has been one of the worst hit. Every step of the supply chain from financing, manufacturing, operation, maintenance and recycling has had to adapt to survive and, fundamentally, there are several market forces that have yet to play out. Here I'll try to share some insight into the causes and effects of a reduction in aircraft material fair market values (FMV). For many entities, common strategies to protect capital, be they mothballing fleets, leveraging assets or furloughing staff have largely been played out and restructuring is underway. Various support mechanisms adopted by stakeholders such as renegotiating lease rates, payment holidays and deferred aircraft deliveries or redeliveries have enabled operations to continue at minimal levels and undoubtedly been a lifeline.