With the aviation industry steadily recovering from the impact of the pandemic, the future looks promising for aircraft lessors in 2024. Morningstar DBRS predicts a stable outlook, supported by robust industry fundamentals and credit ratings. As global travel regains momentum, driven primarily by the Asia-Pacific region, lessors can expect their financial and operational performance to improve significantly.
A key factor in this positive forecast is the projected continuous profitability of airlines along with a minimal default rate. This, in turn, will have a favorable impact on the aircraft leasing industry. Furthermore, there is a growing disparity between the supply of new aircraft deliveries and the surging demand from airlines. This supply-demand imbalance is expected to drive an upswing in lease rates and aircraft values, presenting an excellent opportunity for lessors. Even with minor asset impairments, these challenges can be conveniently absorbed through earnings.
Avtrac, a leading provider of aviation technical services, recognizes the immense potential and value in the aircraft leasing sector. Our expertise lies in conducting comprehensive due diligence and project management support during transactions. We understand that portfolio trading between aircraft investors and lessors requires expert technical analysis of the assets involved. Avtrac excels in this domain, starting from a meticulous physical inspection of the aircraft. We meticulously compile technical data and ensure complete back-to-birth traceability for critical components like engines, landing gears, and APUs. Our aim is to provide clients with the highest level of confidence in asset quality.
In 2024, lessors will face essential financing requirements for new aircraft deliveries and refinancing maturing debts. Maintaining discipline on leverage will be crucial, even in the face of growing debt funding needs. The successful execution of financing at manageable costs will play a pivotal role in ensuring future profitability. Avtrac understands the significance of prudent financial management and is committed to supporting lessors in navigating these challenges.
The global aviation industry remains a long-term growth engine, even amidst geopolitical risks. While tensions between China and the West persist, lessors are adopting a strategic reduction of exposure to mainland China. Nevertheless, China's importance in the industry is undeniable, with Boeing forecasting that nearly 23% of the more than 42,000 aircraft needed globally over the next two decades will be in China. Avtrac recognizes the dynamic nature of the aviation landscape and is ready to guide lessors through these shifting markets.
At Avtrac, we pride ourselves on being a trusted advisor and partner, providing unparalleled expertise and technical knowledge in aviation. Our commitment to continuing airworthiness management and aircraft due diligence is unmatched. We understand the intricacies of the industry and are fully equipped to support lessors in their transactions with other lessors, direct capital deployment with airlines, and order placements with OEMs. As an industry expert, Avtrac aims to exceed client expectations and ensure the success of every venture.
In 2024, as aircraft lessors leverage industry tailwinds and witness advancing lease pricing, Avtrac will be right by your side, delivering expert technical analysis and exceptional aviation technical services. Trust Avtrac to navigate the complexities of the aircraft leasing landscape and guide you toward a prosperous future in the aviation industry.
To learn more about Avtrac and our comprehensive suite of aviation technical services, visit our website today. Partner with us to unlock the full potential of your aircraft leasing ventures.