Avolon's brief update on Q2 activity....

Avolon, the international aircraft leasing company, issues an update for the second quarter of 2023, which show the firm executed 31 lease transactions comprising new aircraft leases, follow-on leases and lease extensions.

Entered into letters of intent for the sale and leaseback of 9 aircraft;

Confirmed order for 40 Boeing 737 MAX aircraft and agreed to order 20 Airbus A330neo aircraft;

Delivered 5 new aircraft and transitioned 13 aircraft to a total of 10 customers;

Sold 3 aircraft and executed sale agreements for a further 17 aircraft;

Entered into letters of intent to place 23 aircraft from our orderbook during the quarter;

Added 2 new customers, giving a total of 149 airline customers operating in 65 countries; and,

Ended the quarter with an owned and managed fleet of 578 aircraft, with total orders and commitments for 297 fuel-efficient, new technology aircraft.

Q2 Business Highlights

Fitch improved Avolon’s BBB- rating outlook from Stable to Positive; 

Raised US$3.4 billion of debt capital in the quarter, including:

Private offering of US$750 million of senior unsecured notes maturing in 2028;

US$1.7 billion Term Loan B refinancing with new loan maturing in 2028; and,

Letter of intent for a US$950 million term financing facility maturing in 2030;

Porter Airlines and Avolon agree sale and leaseback deal for 10 Embraer E195-E2 jets

The total list price of US$841 million 

The first delivery is scheduled for Q4 2023

Avolon, the international aircraft leasing company, and Canadian regional airline Porter have signed a sale and leaseback deal for 10 new Embraer E195-E2 aircraft. The new aircraft will support Porter’s expansion of routes within Canada and further into the North American market. The deal has a value of US$841 million based on current list prices but in reality, is considerably lower.  

 

The transaction represents Avolon’s fifth leasing customer in Canada and will increase Avolon’s portfolio exposure in North America. Four of the aircraft are scheduled for delivery in 2023, with the balance to be delivered in 2024. 

Porter introduced the E195-E2 to commercial service in February 2023 and plans to expand its fleet in coming years, with 50 firm orders and the option to purchase 50 additional aircraft. Porter’s E2 configuration offers passengers a comfortable 132-seat, all-economy, two-by-two set up, with no middle seats. Initial routes for Porter’s E2 fleet are focused within Canada, but the airline has ambitions to expand quickly to the south, soon offering service for its customers to key markets in the US, as well as Mexico and the Caribbean. 

The E195-E2 has been designed to maximize returns and efficiency in achieving 25% lower carbon emissions and fuel burn compared to the previous generation aircraft. The new aircraft also supports Avolon’s progress towards its fleet target of 75% new technology aircraft by 2025.

Paul Geaney, President and Chief Commercial Officer, Avolon commented: “Porter is renowned for its customer experience and has exciting plans for the expansion of its E2 fleet. We are delighted to welcome them as a customer and look forward to partnering on their future growth. Our decision to add the E2 to our portfolio is supported by its growing operator base, with the transaction further diversifying our portfolio, whilst offering attractive returns.  The E2 is a modern fuel-efficient aircraft that offers excellent operating performance, competing effectively with other smaller narrowbody platforms.” 

Jeffrey Brown, Executive Vice President and Chief Financial Officer, Porter Airlines, commented: “The E2 is an incredible addition to Porter’s fleet, offering best-in-class seat cost economics and providing an ideal platform to deliver the truly differentiated in-flight economy passenger experience that Porter is known for. This means treating everyone with care and offering complimentary amenities like WiFi, and beer and wine served in glassware throughout the cabin. We are excited to partner with Avolon and value their reputation and expertise in aircraft leasing, which makes them an ideal new partner.” 

Martyn Holmes, Chief Commercial Officer, Embraer Commercial Aviation, commented: “Embraer is excited to welcome Avolon to the E2 program, another sign that the momentum the E2 is enjoying in the market is set to continue. Adding a lessor of Avolon’s stature to the E2 program is a further endorsement for this great family of aircraft, and the value it delivers to operators and owners alike.”

Big orders from leasing giant Avolon at Paris Air Show....

Avolon orders 40 Boeing 737 MAX Jets

Converts 50 A320neos on order to larger A321neo model

Signs up for 20 Airbus A330neo aircraft. 

At the Paris Air Show on Wednesday, the international aircraft leasing giant Avolon has ordered 60 aircraft and converted a previous order to a larger type of plane. 

The firm has placed a firm order with Boeing for 40  737 MAX aeroplanes, the first order from the company since 2017. However, this isn't a completely new order, it was previously listed as unidentified on the Boeing Orders & Deliveries website with the announcement deliberately delayed to the air show to boost Boeing's publicity coverage at the show. 

Andy Cronin, CEO of Avolon said: "Today's announcement reaffirms our long-standing partnership with Boeing and our support for their 737 MAX program. We are confident in the long-term demand from our customers for the 737 MAX, and this order extends our delivery pipeline out to 2030," 

Stan Deal, president and CEO of Boeing Commercial Airplanes said: "This order demonstrates the popularity of the 737-8 among the leasing community and the demand they are seeing from their customers for this aeroplane model. Avolon has a long-standing relationship with the 737 MAX program and took delivery of the 1,000th 737 MAX last year. We look forward to building on this strong relationship with a key leasing partner as they grow their Boeing portfolio of aeroplanes."

Avolon has also signed a memorandum of understanding with Airbus at the Paris Air Show to order 20 Airbus A330neo aircraft. These new aircraft are scheduled to be delivered between 2026 and 2028.

Avolon was a launch customer for the A330neo programme in 2014 and has fully placed its current widebody order book.  This agreement will also see 50 A320neo aircraft Avolon has on order with Airbus converted to the larger A321neo model as passenger demand has recently rapidily 

Andy Cronin commented:  “We have been a strong supporter of the A330neo programme since its launch and, with our existing widebody orderbook fully placed, we are now locking in future growth in a supply-constrained environment. Our expanded delivery pipeline allows us to offer our customers the A330neo’s range and reduced emissions, supporting their evolving fleet needs. Our recent aircraft orders and commitments reflect our confidence in the long-term growth trajectory of the aviation sector, which is outlined in our recent World Fleet Forecast projecting that the global passenger fleet will almost double by 2042.”

Christian Scherer, Chief Commercial Officer and Head of International at Airbus said: "It’s fantastic to see Avolon once again commit additional investment in the A330neo aircraft and lead the lessor market reordering widebody aircraft. Avolon’s vision and timing could not be better with this commitment for a further 20 aircraft to its portfolio. Avolon will benefit from the strong wave of growth and replacements that we currently observe across all markets."

SalamAir, Oman’s low-cost airline to lease three Airbus A330neo aircraft

International aircraft leasing company, Avolon, has announced a firm commitment to lease three Airbus A330neo aircraft to SalamAir, Oman’s value-for-money airline. A letter of intent was signed at the Paris Air Show on 19 June 2023, and the first delivery is expected to be in October 2023.
The introduction of three new Airbus A330neo widebody aircraft will bring significant advantages to SalamAir and support the airline’s fleet and network expansion plans. These modern aircraft feature a dual-class configuration with 365 economy seats and 12 premium flatbed seats, allowing for enhanced passenger comfort and capacity. The A330neo offers a substantial increase in distance compared to SalamAir's existing fleet.
One notable advantage of the A330neo is its improved fuel efficiency, resulting in reduced fuel consumption and lower CO2 emissions when compared to previous generation aircraft. This contributes to a decrease in operational costs for the airline, aligning with their commitment to environmental sustainability.
Captain Mohamed Ahmed, CEO of SalamAir, commented: “The decision to introduce the Airbus A330neo complements the existing fleet of Airbus aircraft, which includes the A320neo, A321neo, and an A321 freighter. By adding the A330neo to the fleet, SalamAir aims to enhance its capacity, meet the growing demands of the market, and attract more inbound tourists, aligning with the objectives of Oman's Vision 2040.
The extended range of the A330neo will allow SalamAir to efficiently serve medium-range destinations, particularly in the Far East and Europe. This expanded reach not only improves passenger convenience but also enhances the airline's competitiveness in the market. It enables SalamAir to strengthen its network and seize opportunities for further growth and expansion.” 
Paul Geaney, President & Chief Commercial Officer of Avolon, commented:   “We are delighted to welcome SalamAir as a new customer, bringing the fuel-efficiency benefits of the A330neo to another airline. Since their launch, SalamAir’s low-cost model has proven a great success, and these new aircraft will support their plans to offer their growing number of passengers greater capacity and comfort. The expansion of aviation traffic in the Middle East is set to continue and the region is a focus for further leasing opportunities for Avolon.”
Mikail Houari, President, Africa and Middle East at Airbus, commented:  “We are delighted that SalamAir has chosen the A330neo aircraft which offers unique operational versatility with cost and environmental benefits. The A330neo stands out among the wide-body segment with its superior fuel efficiency and range, advanced aerodynamics and technologies, as well as enhanced passenger comfort due to its spacious cabin.”

Avolon releases its latest world fleet forecast.....

Asia to lead growth driven by travel demand from rising middle class

Over US$4 trillion will be required to finance new deliveries providing major role for aircraft lessors

Long-term demand to travel to see friends, family and do business undiminished by pandemic

Avolon, the international aircraft leasing company, publishes its World Fleet Forecast – Return to Growth – projecting trends in the commercial passenger aviation fleet out to 2042. It forecasts the fleet will almost double by 2042, growing 94% to 46,880 aircraft, underpinned by sustained growth in demand for air travel, building on the rapid recovery experienced since the pandemic.

Avolon estimates that over $4 trillion will be required to finance the 44,300 new passenger commercial aircraft to be delivered over the next 20 years, providing a considerable opportunity for lessors to partner with airlines globally to finance their growth ambitions.

Passenger demand will continue to rise by c.3.5% per annum from a 2019 base, but the pace of expansion will be lower than the 5-6% of the previous 20 years due to reduced potential for further deregulation to drive growth, and higher fares because of aircraft supply shortages and increasing sustainability levies. The biggest growth driver will be new middle-class consumers, particularly in India, South-East Asia and Latin America.

Avolon announces extension and upsizing of Term Loan B Facility to $1.7Billion

                Avolon Holdings Limited, the international aircraft leasing company, announces the extension of the TLB-3 tranche of its senior secured US$2.92 billion Term Loan B facility. 

The TLB-3 tranche has been extended from January 2025 to June 2028 through a new TLB-6 tranche and upsized by US$250 million, bringing the total size to $1.68 billion.

The TLB-6 priced at SOFR plus 2.5% with a SOFR floor of 0.5%, subject to an original issue discount (OID) of 99.0.

Ross O’Connor, Avolon Chief Financial Officer, commented: “We are very pleased to have successfully upsized our term loan facility and to have extended its maturity to 2028. The upsizing of the transaction reflects strong demand from both existing and new investors, reflective of the quality of our portfolio and the strength of our business. Together with our recent $750 million unsecured notes issuance, we have raised over $2.4 billion of capital in the second quarter to date, which will support our growth against a backdrop of increasing demand for aircraft from airlines.”

Avolon is 70% owned by an indirect subsidiary of Bohai Leasing Co., Ltd., a public company listed on the Shenzhen Stock Exchange. Avolon is one of the leading aircraft leasing companies globally, with an owned, managed and committed fleet of 830 aircraft, as of 31 March 2023.

Cebu Pacific gets new Airbus A320neo......

Continued growth in new technology fuel-efficient aircraft

Avolon, the international aircraft leasing company, has delivered its 100th Airbus A320neo, which went to Cebu Pacific. 

The delivery to Cebu Pacific is the second A320neo delivery under an agreement made earlier this year for the Philippines' low-cost carrier to lease three new A320neos. The third aircraft is scheduled to be delivered later this month following which Avolon will have 12 aircraft on lease with Cebu Pacific.

Avolon is on track to hit the target of its fleet comprising 75% new technology aircraft by 2025, and has a significant order book pipeline for the A320neo family of aircraft (A320neo/A321neo), with commitments to purchase a further 184 of this aircraft type as at March 31 2023. The A320neo delivers 20% fuel savings and CO2 reduction compared to previous-generation Airbus aircraft.

Avolon announces pricing of $750 million senior unsecured notes offering.....

Avolon Holdings Limited, the international aircraft leasing company, announces the pricing of a private offering by its wholly owned subsidiary, Avolon Holdings Funding Limited, for a principal aggregate amount of US$750 million of 6.375% senior unsecured notes due 2028.

The Notes will be fully and unconditionally guaranteed by Avolon, and by certain of its subsidiaries.

The Offering is expected to close on or about 4 May 2023, subject to customary closing conditions. Net proceeds from the Offering will be used for general corporate purposes, which may include the future repayment of outstanding indebtedness.

The Notes will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or any state securities law and may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and applicable state securities laws. The Notes will be offered in the United States only to qualified institutional buyers under Rule 144A of the Securities Act and outside the United States under Regulation S of the Securities Act.

Leasing giant Avolon to order 40 Boeing 737 MAX jets

The international aircraft leasing company giant Avolon has announced a commitment to order 40 Boeing 737 MAX aircraft with delivery scheduled to be between 2027 and 2030, despite more production line issues and problems. 

Avolon delivered the first 737 MAX in 2017, along with the one thousandth 737 MAX earlier this year and this will increase the overall size of Avolon’s owned, managed and committed fleet to 870 aircraft.

Andy Cronin, CEO of Avolon, commented: "This commitment with Boeing underlines our confidence in the positive momentum in the aviation market, and increases our portfolio of young, modern, fuel-efficient aircraft. With strong demand for our new technology order book, and delivery slots at a premium, it strengthens and extends our delivery profile with Boeing. This commitment will also support our airline customers who are looking to plan beyond the robust post-Covid traffic recovery and prepare for future growth, while also reducing their carbon emissions."

The transaction is subject only to approval by shareholders of Bohai Leasing Co., Ltd., Avolon’s 70% shareholder, which is anticipated before the end of May. The actual cost of the deal has not been disclosed, however, as usual, with large multi-aircraft orders to existing customers, discounts of 20-30% on list prices are not unusual.  

Boeing recently announced that a supplier had revealed that the installation of fittings at the rear of 737 MAX jets did not follow the standard and warned there could be delays.  Whilst Boeing assured the issue was not an "immediate safety of flight issue" many have doubted the sincerity of the words, recalling previous Boeing statements about the risks of other issues encompassing the safety of the 737 MAX. 

The jets have been beset with problems and issues since the two crashes that led to a year-long grounding of the type. In-flight issues surrounding the horizontal stabiliser, autopilot, and engines have all caused concern. Some airlines indicate privately that the savings promised by the manufacturer have not yet been seen in 'real-world' operational use and are clouding the future.  

Avolon delivers 15 Airbus A320neo jets to Vistara

 

Avolon, the international aircraft leasing company, announces it has completed the delivery of 15 A320neo aircraft to Vistara, a joint venture of Tata Group and Singapore Airlines.

 

Paul Geaney, President and Chief Commercial Officer, Avolon commented: “We are delighted to have completed this delivery of 15 fuel efficient new technology aircraft to Vistara. The rapidly growing Indian aviation market is benefitting from Vistara’s continued success and we welcome the opportunity to have supported this expansion of their A320neo fleet.”

 

Deepak Rajawat, Chief Commercial Officer, Vistara commented: “A modern and efficient fleet is the backbone of any airline operations and enables consistent growth. We are pleased to have worked with Avolon on the delivery of these 15 aircraft which enabled us to continue our expansion and offer greater connectivity to our customers.” The airline currently has a fleet of 59 aircraft, including 45 Airbus A320neo, 8 Airbus A321, 2 Boeing 737-800NG and 4 Boeing 787-9 Dreamliner and has flown more than 45 million customers since starting operations. 

For travel insurance....

Latest results from aircraft leasing firm Avolon

The leasing giant Avolon has released details of first quarter performance, showing the firm completed 31 lease deals and delivered 9 new aircraft.  Andy Cronin, CEO of Avolon, commented:  “The year has started with positive momentum as airline passenger growth continues and the impact of reopening in China feeds into increasing travel in the region. The shortage of both narrow and widebody aircraft is a dominant theme and is supportive of growing levels of leasing and trading activity.

Our ambition is to continue to be a leader in our sector on ESG issues. We made further progress towards our key 2025 target for 75% of our fleet to be new technology fuel-efficient aircraft. We have also supported research into ways to scale up production levels of sustainable aviation fuel and received an industry leading rating for our ESG performance.”

Executed 31 lease transactions comprising new aircraft leases, follow-on leases and lease extensions;

Delivered 9 new aircraft and transitioned 9 aircraft to a total of 13 customers;

Sold 2 aircraft and agreed letters of intent for the sale of a further 13 aircraft;

Executed a $810 million term financing facility maturing in 2030, with a syndicate of 10 banks;

Owned and managed fleet of 578 aircraft at quarter end, with total orders and commitments for 252 fuel-efficient, new technology aircraft;

Added 3 new customers during the quarter, for a total of 147 airline customers operating in 65 countries;

A new Airbus A320neo to ITA Airways

Total of 5 Airbus A320-200neos to be delivered to ITA Airways in 2023

 

Avolon, the international aircraft leasing company, has delivered 3 new Airbus A320-200neos to ITA Airways. 

A further 2 aircraft will be delivered later in the year, supporting ITA Airway’s target for its portfolio to comprise 80% new-generation fuel-efficient aircraft by 2026. 

The newly delivered aircraft are the first A320neos in ITA Airway’s fleet. Carrying the company’s striking new blue livery, these aircraft will support its short and medium-haul services in the 2023 summer season. 

Paul Geaney, President and Chief Commercial Officer, Avolon commented: “We are delighted to support ITA Airways with the delivery of the first A320neos in their fleet. One of our core commitments is to help customers make the transition to fuel-efficient new technology aircraft, and this deal demonstrates how a lessor like Avolon can help airlines achieve their sustainability ambitions.” 

Francesco Presicce, Officer, Chief Technology Officer ITA Airways: “The A320neo combines technology and efficiency to deliver 20% less fuel consumption and CO2 emissions per seat compared to previous generation aircraft. It is further enriching ITA Airways modern and environment-friendly fleet, which will feature 80% new generation aircraft by 2026. We are very pleased to be working with Avolon and taking delivery of these new aircraft to serve on our domestic and international network as we look forward to a busy summer 2023.”

Avolon completes delivery of 15 Airbus jets to IndiGo

Avolon, the international aircraft leasing company, announces it has completed the delivery of 15 A320neo family aircraft to IndiGo, India’s largest passenger airline.

Delivery of the aircraft commenced in September 2022 and was completed in February 2023. The sale and leaseback transaction comprised a mix of six A320neo aircraft and nine A321neo aircraft.

Avolon now has a total of 21 aircraft on lease with IndiGo.

Paul Geaney, President and Chief Commercial Officer, Avolon commented: “We are proud to support IndiGo through this sale and leaseback of fifteen fuel-efficient Airbus neo aircraft. We look forward to playing a central role with IndiGo as they continue to build on their position as a leading carrier in the Indian market.”

Riyaz Peermohamed, Chief Aircraft Acquisition and Financing Officer, IndiGo commented: “We are pleased to have completed this deal with Avolon, which is part of IndiGo’s broader expansion plans and the upgrading of our fleet. In 2023 we are committed to enhancing connectivity both within India and internationally.”

Avolon releases latest results for 2022

Aircraft leasing and management specialists Avolon has released its latest results which demonstrated a strong performance in 2022 despite difficult trading conditions.

Avolon owned and managed a fleet of 576 aircraft at year-end, with total orders and commitments for 258 fuel-efficient, new-technology aircraft.  Executed a total of 237 lease transactions comprising new aircraft leases, follow-on leases and lease extensions. Delivered a total of 35 new aircraft and transitioned 35 aircraft to a total of 27 customers. Sold 36 aircraft during the year and added 10 new customers during 2022, ending the year with a total of 146 airline customers operating in 63 countries.

 

The firm agreed a landmark transaction with Malaysia Airlines for the financing of 20 A330-900neo aircraft valued at over $2 billion. Delivered our first A330 to IAI for conversion to dedicated freighter operations. Received inaugural ESG Rating from Sustainalytics with a score of 16.0 placing Avolon in the ‘Low Risk’ category and the top 5% of our industry grouping and fully placed our order for 500 Vertical Aerospace eVTOLs.

 

Leasing giant Avolon delivered five Boeing 737 MAX jets to Akasa Air

Avolon’s first lease deal with India’s newest airline

 

Avolon, the international aircraft leasing company, has confirmed it has completed the delivery of 5 new Boeing 737-8 MAX aircraft to Akasa Air, India’s newest airline.  Delivery of the aircraft commenced in December 2022 and was completed in January 2023. This sale and leaseback transaction is Avolon’s first deal with Akasa.

Paul Geaney, President and Chief Commercial Officer at Avolon commented: “We are excited to support new entrants to the market, so it is a pleasure to have completed this transaction to lease 5 new narrowbody aircraft to Akasa. We congratulate Akasa on their successful launch and look forward to building on our strong relationship with them.”

Bhavin Joshi, Co-Founder and Sr. Vice President - Leasing & Procurement at Akasa Air commented: “Since our launch last August we have rapidly added capacity, new routes and welcomed one million passengers to our unique offering. We are delighted to join hands with Avolon and will continue to invest in new technology aircraft that can offer superior reliability and carbon efficiency.”

Akasa Air hopes to have a fleet of 72 Boeing 737 MAX aircraft powered by the highly fuel-efficient CFM LEAP-1B engine, over a period of five years.  The 737 MAX family provides low seat-mile costs for a single-aisle aeroplane as well as high dispatch reliability. Every aircraft will feature the Boeing Sky Interior, highlighted by modern sculpted sidewalls, window reveals and LED lighting that enhances the cabin experience.

The aviation sector is set to thrive in 2023 with global traffic to reach pre-pandemic levels by June

The aviation sector is set to thrive in 2023 with global traffic to reach pre-pandemic levels by June, according to a paper published today by international aircraft leasing company Avolon.

After a 70% recovery in passenger traffic last year led by recovery in Europe and North America, Asia will drive growth in 2023, helped by the recent reopening in China. For every two seats of airline capacity added in the world today one is in Asia.

The traffic recovery brought the sector back to the brink of profitability in 2022, after combined sector losses of $180bn in 2020 and 2021. A profit of c.$4.7bn is forecast for 2023 as recovery continues.

Avolon’s 2023 Outlook: Climb to Cruise paper, available here reviews trends in the sector for airlines, manufacturers, and lessors. Key findings include:

• Airlines: Airlines’ financial recovery is ahead of their capacity recovery: while air traffic is still 25% below 2019 levels, revenues are just 13% lower as airlines flex their pricing power and raise fares. Demand for travel is no longer the constraint to recovery, but airlines’ capacity to put planes in the air.
• Manufacturers: Delivery delays have become endemic and an aircraft shortage is emerging given the lost production of 2,400 planes that had been planned but were not built due to the pandemic. As traffic flows rebound, the absence of new aircraft is increasing supply tension, supporting long-term residual values.
• Lessors: Airlines have shrunk their owned fleets by 3% since 2019, whereas lessors have grown theirs by 17% and now manage 53% of the global passenger fleet by value. Aviation markets are adjusting to higher interest rates, and lease rates are increasing, creating opportunities for well capitalized investment grade lessors.
• Sustainability: Aviation needs to make greater progress addressing concerns about its long-term environmental impact. Sustainable Aviation Fuel (SAF) production tripled in 2022 but still represents only 1% of the amount hoped to be produced in 2030. Lifting SAF production to 10% of jet fuels will require $250 billion in investment and collaboration between all industry stakeholders.

Andy Cronin, CEO of Avolon commented:

“Aviation has demonstrated its resilience and is ready to thrive having come through a pandemic-driven two-thirds drop in traffic. Airlines, manufacturers, and lessors share an ecosystem that creates opportunities for all but requires collaboration to overcome key challenges including a higher interest rate environment, limited aircraft availability and the need to make further progress on decarbonisation goals.”

“The rebound in 2022 is set to continue in 2023, with China’s reopening helping to drive global traffic levels to pre-pandemic levels by June. Airlines are enjoying higher fares and load factors, and manufacturers are under pressure to ramp up production quicker. Whilst geopolitical and macroeconomic risks remain, this is a positive environment for lessors as supply constraints drive higher lease rates and increase the value of order books.”

Avolon's last quarter and full year update...

Executed 237 lease transactions during 2022;

Delivered, transitioned and sold a total of 107 aircraft;

Agreed a landmark transaction with Malaysia Airlines for the financing of 20 A330-900neo aircraft valued at over $2 billion;

Raised $2.2 billion of new financing and increased total revolving debt capacity to over

$6.0 billion;

Received inaugural ESG Rating of 16.0 (‘Low Risk’) from Sustainalytics; and

Partnered with global aviation leaders on a Sustainable Aviation Fuel feasibility study.

Avalon, the international aircraft leasing company, issues an update for the fourth quarter (‘Q4’) and 2022 full year (‘FY’).

 

Andy Cronin, CEO Avolon, commented:  “2022 was a successful year for Avolon as borders reopened around the globe and our customers returned to the skies, capitalising on the pent-up demand for travel. This appetite for travel was reflected in the increased utilisation of our fleet compared to 2021, with demand for both our new and used aircraft support- ing our strong leasing and trading activity.

 

As we enter 2023, the outlook for the business is positive; we have an industry leading platform, an orderbook of new technology aircraft, a global footprint and a robust balance sheet. We are well positioned to continue to support our customers and capitalise on the improving market backdrop.”

 

Q4 BUSINESS HIGHLIGHTS

 

-     Executed a total of 75 lease transactions in the quarter comprising new aircraft leases, follow-on leases and lease extensions;

-     Delivered a total of 25 new aircraft to 7 customers and transitioned 8 aircraft to follow-on lessees;

-     Sold 18 aircraft; and

-     Announced a partnership with Boeing, ORIX Aviation, SFS Ireland and SkyNRG, to conduct a feasibility study into the production of Sustainable Aviation Fuel (SAF).

 

2022 FULL YEAR HIGHLIGHTS

 

-     Executed a total of 237 lease transactions comprising new aircraft leases, follow-on leases and lease extensions;

-     Delivered a total of 35 new aircraft and transitioned 35 aircraft to a total of 27 customers;

-     Sold 36 aircraft in 2022;

-     Owned and managed fleet of 576 aircraft at year end, with total orders and commitments for 258 fuel-efficient, new technology aircraft;

-     Added 10 new customers during 2022, for a total of 146 airline customers operating in 63 countries;

-     Raised $2.2 billion of new debt, including Avolon’s inaugural JOLCO financing;

-     Upsized unsecured revolving facility to $4.6 billion, bringing total revolving debt capacity to over $6.0 billion at year end;

-     Fully placed our order for 500 Vertical Aerospace eVTOLs and delivered our first A330 to IAI for conversion to dedicated freighter; and

-     Received inaugural ESG Rating from Sustainalytics with a score of 16.0 placing Avolon in the ‘Low Risk’ category and the top 5% of our industry grouping.

Avolon, Boeing, ORIX Aviation, SFS Ireland and SkyNRG to assess opportunities for Sustainable Aviation Fuel - SAF production in Ireland

Avolon, the international aircraft leasing company, announces a collaboration with Boeing, ORIX Aviation, SFS Ireland and SkyNRG, to conduct a feasibility study into the production of Sustainable Aviation Fuel (SAF) in Ireland. This partnership reflects Avolon and its partners’ commitment to taking a leading role in helping develop future technologies that reduce the aviation sector’s carbon footprint.

Growth in renewable energy makes Ireland a potential location for SAF production

 

SAF can cut sector emissions up to 80% and offer the largest potential to reduce carbon emissions over the next 20 to 30 years in all aviation segments.

The study is being led by SFS Ireland and SkyNRG with the goal of identifying market level opportunities for an investable commercial-scale SAF production facility in Ireland. The study will be completed in 2023.

The planned growth of renewable energy sources in country makes Ireland a potential location for SAF production.   As a global leader in aviation finance and airline operations, Ireland is home to key stakeholders in aviation’s decarbonization journey.

SAF is a commercially used fuel that reduces lifecycle emissions by up to 80%, creating the opportunity to significantly lower aviation’s reliance on fossil fuels, as well as its overall emissions. IATA, the trade association of the world's airlines, sees SAF playing a key role in helping aviation reach its net zero target by 2050 – a target that has been set by its member airlines – contributing to c.65% of the reduction in emissions needed.

Andy Cronin, Avolon CEO commented: “It’s imperative that the aviation sector delivers on its promise to invest in innovation to reduce its carbon footprint. We are delighted to be partnering with a team of global experts that have a shared ambition of being at the forefront of sustainable innovation that will reshape the future of aviation. The path to net zero requires a combination of new technology aircraft and large-scale deployment of SAF, and this project will help deliver sustainable solutions to accelerate decarbonization.”

Sheila Remes, Boeing Vice President, Environmental Engagement and Business Development commented: “We will need a massive increase in the amount of SAF if we are to reach our industry’s commitment to net zero carbon emissions by 2050. Scaling SAF is paramount. Ireland’s growth in renewable energy makes it a prime location for SAF production with zero climate impact. Global partnerships like this enable us all to advocate for and scale SAF supply.”

James Meyler, ORIX Aviation CEO commented: “We are delighted to be a part of this project which we see as being an important step in the roadmap to decarbonising aviation. We are looking forward to bringing value to this partnership of global experts by leveraging the ORIX Group’s expertise. Further development and large scale commercialisation of SAF is a critical milestone for the industry to reach together and this project will help deliver on that.” 

Darren Carty, SFS Ireland commented: “Aviation has a rich history in Ireland, embedded in over 50 years of innovation and leadership. As pilots, we understand and acknowledge the importance of delivering SAF to the market and see the Irish aviation industry as a central player in the mission to decarbonise air transport globally. We are proud to be a part of this exciting new team, forging a path toward a cleaner, brighter, and more sustainable future.”

Philippe Lacamp, SkyNRG CEO commented: “The aviation industry will rely on a number of pathways to meet its net-zero 2050 targets and collaboration with global experts to help drive innovation in SAF is key to being successful. We are proud to be working with Avolon, Boeing, ORIX Aviation, and SFS Ireland on this feasibility study. Each new SAF research project brings us one step closer to identifying what production pathways and sustainable feedstocks are available and helping evaluate how best to assist the aviation industry in meeting mandated targets. The outcome of this study will be of great value to Ireland’s aviation sustainability journey.”

Ireland’s Deputy Prime Minister and Minister for Enterprise, Trade, and Employment Leo Varadkar opens Avolon's new Singapore office

Avolon’s Chairman Asia Pacific & Middle East, Simon Hanson, presented Tánaiste Leo Varadkar with a
framed collage of the opening of Avolon’s Dublin HQ in 2018. Photo Avolon

Avolon, the leading international aircraft leasing company, officially opened its new office in Singapore yesterday, in a ceremony attended by Ireland’s Deputy Prime Minister (Tánaiste) and Minister for Enterprise, Trade, and Employment Leo Varadkar TD.

Avolon first opened an office in Singapore in 2012, and it has expanded this into a key hub for the company’s operations in Asia-Pacific, where regionally it has a team of 32 staff located across Singapore, Hong Kong and Shanghai. It has 65 airline customers in the region, located in 18 countries to whom it currently leases 272 Airbus and Boeing aircraft. The new office will allow Avolon to better serve its airlines in the region and increase its relevance in Singapore which is a growing centre of excellence for aviation finance.

The opening on 3rd November was accompanied by a brief ceremony and meeting together with the local team. It followed on from Mr Varadkar’s successful opening of Avolon’s Dublin Office in September 2018. The Tánaiste visited the Avolon office as part of a wider trade mission to Singapore organised by Enterprise Ireland.

Tánaiste Leo Varadkar commented: “It is great to join the Avolon team in Singapore for the opening of their new offices. The company’s expansion from a start-up in 2010 to one of the leaders in its industry is a great Irish success story. Ireland has developed into a centre of aviation finance excellence and it is exciting to see how Avolon’s global expansion is developing.”

Simon Hanson, Chairman, Asia Pacific & Middle East, Avolon commented: “We are honoured to welcome the Tánaiste to the opening of our new Singapore office. With borders reopened across Asia post pandemic there has been a resurgence in air travel that has led to rapid recovery in demand for our aircraft. We appreciate the continued support of Ireland’s Ambassador to Singapore Sarah McGrath and her team’s proactive engagement with Irish businesses with operations here.”

Avolon names Doug Keatinge as Head of Communications

Avolon, the international aircraft leasing company, announces that Doug Keatinge has joined as Head of Communications. Doug will be responsible for leading Avolon’s corporate and financial communications.

Doug has over 20 years’ experience in public relations and journalism, most recently as a Partner at Murray Group, a leading PR consultancy. Doug has also worked as a journalist for Irish broadcaster RTÉ and Bloomberg, and in investor relations and strategy roles for Digicel and L.E.K Consulting.

Andy Cronin, Avolon CEO, commented: “Avolon has always had an exciting story to tell and I’m very pleased that Doug is joining us to support the next stage of our journey. Doug’s track record of developing and implementing strategic communications programmes will contribute to our success as the refreshed leadership team at Avolon delivers future growth.”