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Implications of the 2008-2009 Crisis
on the Air Finance Market


Sylvain Gloux
MSc Air Transport Management
Air Transport Department, University of Cranfield


167 pages

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About the Author:
This work is the professional thesis achieved by Sylvain GLOUX as part of his double-graduation in Management of International Affairs at the University of Lyon III Jean Moulin and Management of International Risks Management at HEC Paris Business School.
Prior to that, Sylvain has studied Business Administration and Corporate Finance at IPAG Paris and worked with Air France, Olympic Airways, Air France/KLM Cargo, BNP Paribas Aviation Finance Group, Fortis Bank Aviation Finance and COFACE Air Transport Department.
Sylvain also holds a Certificate of Airline Finance and Accountig Management from the International Air Transport Association (IATA) and International Risks Insurance from ENASS Paris. He is now completing a degree in Air Transport Management in Cranfield University.
He is a member of the Royal Aeronautical Society and the European Aviation Club.


Index

Acknowledgment 5

Index 7

Table of figures 9

Introduction 13

Chapter I: State of the Air Transport Industry 15
I. 2007: Record growth & Profitability; toward sustainable Air Transport growth 17
I.1. A cyclical industry: observation 17
I.2. A cyclical industry: explanatory factors 20
I.3. The recovery to long term growth 25
II. 2008: Act I, the energy crisis 35
II.1. Jet Fuel Prices Development 35
II.2. Implication for the Air Transport Industry 38
III. 2009: Act II, the financial & economic crisis 47
III.1. The fincial crisis 47
III.2. Implication for the Air Transport Industry: traffic trend reversal 52
III.3. Industry results and forecast 60

Chapter II: State of the Aircraft Finance Industry 65
I. Defining the need for new aircraft 67
II. Identifying the risks in aircraft financing 83
II.1. The Credit Risk 83
II.2. The Asset Risk 100
II.3. The Repossession Risk 116
III. The aircraft finance market: actors and products 122
III.1. Aviation finance background 122
III.2. Banks & Commercial Debt 125
III.3. Capital Markets 129
III.4. Operating Leasing 130
III.5. Export Credit 134
III.6. Manufacturers’ Support 140
III.5. New Sources of Finance 143
III.5. The Funding Gap 145

General Conclusion 147

Bibliography 153

Books 153

Academic Papers 153

Journals & Managzines 153

Professional Reports 156

Presentations & Conferences 158

Data Sources 160

Other Sources 160

Miscellanous 161


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