Bombardier Aerospace, a unit of Canada's Bombardier Inc., said Thursday it signed an US$8-billion aircraft-leasing agreement with ICBC Financial Leasing Co., and its major shareholder Industrial Commercial Bank of China, the giant Chinese bank.
The deal is the second recent, big leasing agreement Bombardier has inked with a large Chinese bank, as the aircraft maker seeks to boost sales in China's fast-growing market. Last year, Bombardier agreed to a US$3.85-billion customer financing deal with China Development Bank Corp.'s leasing unit.
The memorandum of understanding announced Thursday will provide advance-payment financing, delivery financing and other leasing services for customers of Bombardier's Q-Series, CRJ Series and CSeries commercial aircraft, as well as several Bombardier business-jet models.
"This MOU provides mutual benefits to Bombardier and ICBC Leasing since it addresses both parties' objectives of providing optimized aircraft solutions to operators in China and elsewhere," said Guy C. Hachey, President and Chief Operating Officer, Bombardier Aerospace in a statement. "We look forward to a long-lasting, fruitful cooperation with ICBC Leasing."
With big U.S. and European lenders tight-fisted in the wake of the global credit crisis, Chinese lenders have been seen as an important source of potential capital financing for airlines looking to restock their aging fleets.
The Bombardier-ICBC accord could foreshadow a potential CSeries order in the next three-to-months from a Chinese customer, says GMP Securities analyst Marko Pencak.
"Given the size of the proposed facility, we are hard pressed to imagine that demand for (business jets) and regionals would be anywhere close to US$8 billion. In our view, only the CSeries has the potential to meaningfully draw on a facility of this size," he said in a note.
The company has previously said that it's in serious talks with a "handful" of customers, and sees tremendous potential for the narrowbody aircraft in China.
The deal is the second recent, big leasing agreement Bombardier has inked with a large Chinese bank, as the aircraft maker seeks to boost sales in China's fast-growing market. Last year, Bombardier agreed to a US$3.85-billion customer financing deal with China Development Bank Corp.'s leasing unit.
The memorandum of understanding announced Thursday will provide advance-payment financing, delivery financing and other leasing services for customers of Bombardier's Q-Series, CRJ Series and CSeries commercial aircraft, as well as several Bombardier business-jet models.
"This MOU provides mutual benefits to Bombardier and ICBC Leasing since it addresses both parties' objectives of providing optimized aircraft solutions to operators in China and elsewhere," said Guy C. Hachey, President and Chief Operating Officer, Bombardier Aerospace in a statement. "We look forward to a long-lasting, fruitful cooperation with ICBC Leasing."
With big U.S. and European lenders tight-fisted in the wake of the global credit crisis, Chinese lenders have been seen as an important source of potential capital financing for airlines looking to restock their aging fleets.
The Bombardier-ICBC accord could foreshadow a potential CSeries order in the next three-to-months from a Chinese customer, says GMP Securities analyst Marko Pencak.
"Given the size of the proposed facility, we are hard pressed to imagine that demand for (business jets) and regionals would be anywhere close to US$8 billion. In our view, only the CSeries has the potential to meaningfully draw on a facility of this size," he said in a note.
The company has previously said that it's in serious talks with a "handful" of customers, and sees tremendous potential for the narrowbody aircraft in China.
