2011 Global Aerospace Outlook — Challenges of an Ever-Changing Industry.
NEW YORK--(BUSINESS WIRE)--Citing increasing fuel prices and competition as their leading challenges, airlines today are focused on driving costs down and growing revenues, according to Jeff Knittel, President of Transportation Finance at CIT Group Inc. (NYSE: CIT), a global leader in transportation finance. These are just some of the findings Knittel shares while discussing CIT’s exclusive global aerospace study, “2011 Global Aerospace Outlook — Challenges of an Ever-Changing Industry.”
The interview is part of the latest installment of CIT’s award-winning “5 Minute Capital” (www.5minutecapital.com) podcast series, featuring senior CIT executive commentary on current market conditions and industry trends.
In commenting on the challenging environment airlines are facing, Knittel says: “The recession, the lack of revenue for that period of time, has forced airlines to become more efficient. … Airlines have been very creative in coming up with ways to not only cut costs, but also in ways to enhance their revenue streams.” The study shows that, especially during the last two years, airlines have been in “survival mode.”
To address the top concern of rising fuel costs, 83 percent of airlines indicated they would like to acquire or lease more efficient aircraft; however, 68 percent said they are taking a wait-and-see approach. Knittel says: “Technology obviously drives costs down. They’re looking at trying to bring costs in and it is just not aircraft technology. One of the biggest issues the airlines face is that a major part of their cost structure is out of their control and really controlled by the governments of the world” (i.e., air traffic control systems, runways, etc.).
The report, prepared in association with Forbes Insights, gathered the views of senior airline executives from around the world (with fleets of 25 or more jet aircraft) on the issues and challenges they are facing, as well as steps they plan on taking to move forward.
EDITOR’S NOTE: Complimentary copies of the report are available for download at www.cit.com/aerospaceoutlook.
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Founded in 1908, CIT (NYSE: CIT) is a bank holding company with more than $35 billion in finance and leasing assets. It provides financing and leasing capital to its more than one million small business and middle market clients and their customers across more than 30 industries. CIT maintains leadership positions in small business and middle market lending, factoring, retail finance, aerospace, equipment and rail leasing, and global vendor finance. www.cit.com