The aircraft industry relies heavily on support from official export credit.
Export credit agencies are major funders of aircraft - in 2010 about 50% of all Airbus deliveries were covered by export credit agencies. There are concerns that this heavy reliance on ECAs creates an uneven playing field, as the smaller airlines are less able to access this kind of finance.
The problem with the aircraft industry
Aircraft are a major source of greenhouse gases, contributing to global climate change. The current boom in cheap flights and accessible financing contributes to a concoction of high-carbon industries which risk making it virtually impossible for many countries that have signed up to the Kyoto Protocol to meet their C02 emissions targets.
ECAs and the aircraft industry
ECAs allocate about a third of their long-term financing to aircraft sales, the largest representation of any sector. In France, the company Airbus alone benefits from 37% of all COFACE guarantees (€ 9.5 billion between 2001 and 2008, or €1.2 billion Euros per year).
Financing choices for for airlines and lessors are limited, and export credit is valuable in helping them to secure funding. This is particularly true in the wake of the global financial crisis; for instance in 2008 the US Ex-Im Bank guaranteed $5.5 billion to finance 90 aircraft, up by more than a billion dollars on the previous year.
About a third of all financing for commercial aircraft manufacture now comes from export credit, according to the OECD. The OECD Sector Understanding on Export Credits for Civil Aircraft (the ASU) sets out the rules for ECAs from OECD countries regarding aircraft finance. The sector understanding includes a maximum 12 year loan repayment period.