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NEWS Last modified on March 15, 2013

Aviation professionals downbeat on government support

Norton Rose’s The Way Ahead survey finds only one third of aviation professionals expect government support to keep pace with the sector’s needs.

Norton Rose’s The Way Ahead survey finds only one third of aviation professionals expect government support to keep pace with the sector’s needs.

In the international legal firm's fourth transport survey, 83% of aviation respondents see investment in infrastructure as “essential”. Yet only 33% expect government support to be enough over the next five years.

New capacity at existing airports is the most urgent infrastructure need, said 41% of respondents. But developing airport capacity in new or growing markets was the priority for 32%.

Globally, Middle East professionals have most faith their governments will meet infrastructure needs, while those in Africa are most pessimistic.


Yet fuel costs loom largest among the sector’s worries. About 64% of aviation respondents see more efficient fuel consumption as the most crucial development focus.

The survey also revealed that the downturn has prompted 66% of aviation businesses to seek to change their market position since 2010.

New strategies include entering new market segments (52%), embarking on new geographical markets (45%) and expanding in their products and services (45%).

About 36% of respondents see tighter finances as among the biggest changes to their businesses between 2010 and 2012.

In seeking funding, aviation will still turn to traditional sources such as shareholders, bank debt and capital markets over the next two years, found the survey.

But alternative forms of finance could be set to play a greater role, said Norton Rose. A quarter of respondents are using or intend to use structured finance for the first time, 24% long-term leasing, 17% bond financing and 16% private equity.

London was viewed as the financial centre best able to meet the transport industry's financing needs, followed by New York and Singapore.

 

 

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