The head of General Electric Co.'s (GE) business-jet lending and leasing unit is forecasting solid demand in 2011, based on continued improvement in the economy and corporate profits.
"I'm very much encouraged for a much better 2011," said Dave Labrozzi, president of Corporate Aircraft Finance at GE Capital, the conglomerate's big finance arm.
The overall market for business jets has been difficult for the past few years due to the poor economy, which prompted companies to cut costs and sell assets. The aircraft also became a symbol of corporate excess in some cases.
But Labrozzi, speaking in an interview Tuesday, said those issues shouldn't restrain demand next year.
"This market is completely driven by corporate profits and the economy," both of which are on the upswing, he said.
GE doesn't release financial results for its business-jet lending and leasing arm, one of the biggest players in the global sector. Labrozzi declined to say if the unit has been profitable in 2010, although he stressed it performed better than in 2009 and "has been a good business for [GE] for a long time."
He said he thinks negative publicity that became associated with business jets during the era of taxpayer-funded bailouts "has largely abated," meaning the stigma about their use probably won't factor into many future corporate decisions.
Tuesday, December 21, 2010
Business-Jet Financing Demand To Improve In 2011
In addition, he said, prices for used business jets are at or very close to a bottom--having tumbled 25% to 35% on average over the past three years--so some corporations that have been holding out for the best deals don't have reason to continue delaying.
"Folks are now getting back into the market," Labrozzi said. "If we're not at a bottom [on used prices], then people are thinking we're close enough there."
Honeywell International Inc.'s (HON) aviation unit cast something of a pall over the business-jet sector in October, predicting in a closely watched annual outlook that the number of new aircraft deliveries may not perk up until 2012.
But Labrozzi chalked up the trend largely to the high numbers of used aircraft that remain on the market, not to a lack of corporate demand.
"I think [GE] is going to have a good year" in 2011 in terms of business-jet lending and leasing, he said. "And I think the industry itself is going to be much better off, but the lag on the new manufacturing side is going to take some time" to catch up
"Folks are now getting back into the market," Labrozzi said. "If we're not at a bottom [on used prices], then people are thinking we're close enough there."
Honeywell International Inc.'s (HON) aviation unit cast something of a pall over the business-jet sector in October, predicting in a closely watched annual outlook that the number of new aircraft deliveries may not perk up until 2012.
But Labrozzi chalked up the trend largely to the high numbers of used aircraft that remain on the market, not to a lack of corporate demand.
"I think [GE] is going to have a good year" in 2011 in terms of business-jet lending and leasing, he said. "And I think the industry itself is going to be much better off, but the lag on the new manufacturing side is going to take some time" to catch up
Banks agree £200bn for businesses but pay talks unresolved
An offer by major banks to lend £200bn to businesses and show "pay discipline" is to be the subject of further discussions between senior ministers and top bankers over the Christmas period.
George Osborne, the chancellor, and Vince Cable, the business secretary, called for another round of talks after a showdown with bank bosses today to discuss lending and bonuses, just as the bonus season begins in the City and coinciding with public sector job cuts.
The bankers – including John Varley, the outgoing chief executive of Barclays, and Douglas Flint, the new chairman of HSBC – presented a plan to ministers that would involve a pledge to lend £200bn to businesses, including £70bn specifically for smaller companies.
The so-called project Merlin proposals, which have been led by Varley, also included a promise for restraint on bonuses but did not provide any specific assurances on what this might mean.
The bankers are eager to calm the political rhetoric surrounding their bonus season and to return to the calmer relations which existed between the sector and governments before the 2008 banking crisis.
Banks agree £200bn for businesses but pay talks unresolved
Top bankers from Santander, Lloyds and Royal Bank of Scotland also attended the talks which had been delayed by a day after the chancellor was held up by the snow.
Ministers felt discussions were constructive, even though they did not reach a specific outcome and were eventually overshadowed by the furore surrounding Cable's comments that he had "declared war" on Rupert Murdoch and his media empire.
Cable had gone into the meeting keen to achieve greater disclosure on the ways bankers are paid, a move he regards as crucial to show the coalition is taking action.
However, the chancellor has been less focused on forcing bankers to admit how much they pay themselves outside the boardroom and backed away from proposals designed by City grandee Sir David Walker to publish the number of staff earning more than £1m.
The government tonight said the talks with the bankers had discussed "bank lending – particularly to small and medium-sized businesses – and pay discipline, and how the banking industry can best support economic growth and job creation in the UK in 2011 and beyond".
Ministers felt discussions were constructive, even though they did not reach a specific outcome and were eventually overshadowed by the furore surrounding Cable's comments that he had "declared war" on Rupert Murdoch and his media empire.
Cable had gone into the meeting keen to achieve greater disclosure on the ways bankers are paid, a move he regards as crucial to show the coalition is taking action.
However, the chancellor has been less focused on forcing bankers to admit how much they pay themselves outside the boardroom and backed away from proposals designed by City grandee Sir David Walker to publish the number of staff earning more than £1m.
The government tonight said the talks with the bankers had discussed "bank lending – particularly to small and medium-sized businesses – and pay discipline, and how the banking industry can best support economic growth and job creation in the UK in 2011 and beyond".
Banks agree £200bn for businesses but pay talks unresolved
"The banks have put a number of proposals on the table. The government affirmed its desire to see a strong, responsibly and internationally competitive financial sector. The dialogue was constructive," a spokesperson added.
"These proposals will be the subject of further discussions over the Christmas period with the aim of building a sustainable, co-operative relationship between the lenders and government in 2011 in support of the economic recovery."
While Cable had raised the idea over the weekend that new taxes could be imposed on banks if they did not start lending more to business Osborne appeared to step back from this in parliament today.
Osborne told MPs that the £2.5bn a year bank levy on balance sheets showed the government was serious about tackling banks.
"What we've demonstrated in the last couple of weeks is we are prepared to increase the rate of the bank levy in order to sustain the revenue," he told parliament.
The bonus round has been particularly fraught since the bailout of the banks in 2008.
"These proposals will be the subject of further discussions over the Christmas period with the aim of building a sustainable, co-operative relationship between the lenders and government in 2011 in support of the economic recovery."
While Cable had raised the idea over the weekend that new taxes could be imposed on banks if they did not start lending more to business Osborne appeared to step back from this in parliament today.
Osborne told MPs that the £2.5bn a year bank levy on balance sheets showed the government was serious about tackling banks.
"What we've demonstrated in the last couple of weeks is we are prepared to increase the rate of the bank levy in order to sustain the revenue," he told parliament.
The bonus round has been particularly fraught since the bailout of the banks in 2008.
PM slaps down business minister over Murdoch remarks
In a statement, Cable said he fully accepted Cameron's decision, adding: "I deeply regret the comments I made and apologise for the embarrassment that I have caused the government."
Discussing News Corporation's bid, Cable told the undercover reporters: "I have blocked it, using the powers that I have got. And they are legal powers that I have got.
"I can't politicise it, but for the people who know what is happening, this is a big thing. His whole empire is now under attack. So there are things like that, that being in government... All we can do in opposition is protest."
Murdoch owns Britain's top-selling daily newspaper, The Sun, which backed Cameron's Conservatives in the elections in May.
The mogul was also reportedly one of the prime minister's first visitors when he took office after the vote.
A spokesperson for News Corporation had earlier said that it was "shocked and dismayed" by Cable's remarks, adding: "They raise serious questions about fairness and due process."
The Daily Telegraph first published remarks Tuesday by Cable indicating he could quit and "bring the government down" if the centre-left Liberal Democrats is pushed too far in compromising with the centre-right Conservatives.
Discussing News Corporation's bid, Cable told the undercover reporters: "I have blocked it, using the powers that I have got. And they are legal powers that I have got.
"I can't politicise it, but for the people who know what is happening, this is a big thing. His whole empire is now under attack. So there are things like that, that being in government... All we can do in opposition is protest."
Murdoch owns Britain's top-selling daily newspaper, The Sun, which backed Cameron's Conservatives in the elections in May.
The mogul was also reportedly one of the prime minister's first visitors when he took office after the vote.
A spokesperson for News Corporation had earlier said that it was "shocked and dismayed" by Cable's remarks, adding: "They raise serious questions about fairness and due process."
The Daily Telegraph first published remarks Tuesday by Cable indicating he could quit and "bring the government down" if the centre-left Liberal Democrats is pushed too far in compromising with the centre-right Conservatives.
Pak-India Business Council welcomes TAPI gas project
ISLAMABAD: Pak-India Business Council welcomed the Turkmanistan, Afghanistan, Pakistan and India (TAPI) gas pipeline project and termed it a historic step among the member countries. It met Monday with Noor Muhammad Kasuri in the chair and reviewed economic situation of the country and hurdles being faced in Pak-India trade. The project would help to fulfill the energy demands of Afghanistan, Pakistan and India besides strengthening the political and economic relations among the member countries. Council chairman said increasing energy demands of the country were ignored badly during last 50 years and domestic energy resources were sold out to a group to maintain their monopoly in the sector.
PM slaps down business minister over Murdoch remarks
EU regulators on Tuesday cleared News Corporation's attempt to buy a majority stake in BSkyB but the deal remains subject to a British regulatory review, which is due to report next week.
Cameron's spokesman said Cable's remarks "were totally unacceptable and inappropriate" and the prime minister took swift action.
"Following comments made by Vince Cable to the Daily Telegraph, the prime minister has decided that he will play no further part in the decision over News Corporation's proposed takeover of BSkyB," the spokesman said.
"In addition, all responsibility for competition and policy issues relating to media, broadcasting, digital and telecoms sectors will be transferred immediately to the secretary of state for culture, media and sport".
This includes responsibility for the communications watchdog.
Cameron's spokesman said Cable's remarks "were totally unacceptable and inappropriate" and the prime minister took swift action.
"Following comments made by Vince Cable to the Daily Telegraph, the prime minister has decided that he will play no further part in the decision over News Corporation's proposed takeover of BSkyB," the spokesman said.
"In addition, all responsibility for competition and policy issues relating to media, broadcasting, digital and telecoms sectors will be transferred immediately to the secretary of state for culture, media and sport".
This includes responsibility for the communications watchdog.
PM slaps down business minister over Murdoch remarks
LONDON — Prime Minister David Cameron stripped his business secretary of key powers Tuesday over what he termed "totally unacceptable and inappropriate" remarks about media mogul Rupert Murdoch.
Cameron's spokesman said that Vince Cable, a senior Liberal Democrat member of the Conservative-led coalition, would no longer have a say in Murdoch's bid to take full control of pay TV giant BSkyB, and his department would lose other powers.
The prime minister acted after Cable told undercover newspaper reporters that he had "declared war" on Murdoch and planned to block his New Corporation's 7.75-billion-pound bid for BSkyB.
"You may wonder what is happening with the Murdoch press," Cable told the Daily Telegraph reporters, who were posing as constituents. "I have declared war on Mr Murdoch and I think we're going to win."
Cameron's spokesman said that Vince Cable, a senior Liberal Democrat member of the Conservative-led coalition, would no longer have a say in Murdoch's bid to take full control of pay TV giant BSkyB, and his department would lose other powers.
The prime minister acted after Cable told undercover newspaper reporters that he had "declared war" on Murdoch and planned to block his New Corporation's 7.75-billion-pound bid for BSkyB.
"You may wonder what is happening with the Murdoch press," Cable told the Daily Telegraph reporters, who were posing as constituents. "I have declared war on Mr Murdoch and I think we're going to win."
Engler Named Business Roundtable CEO
WASHINGTON—National Association of Manufacturers President John Engler has been appointed chief executive of the Business Roundtable, a group of leaders of the nation's biggest multinational companies, often tapped to advise the White House on policy.
Mr. Engler, a former Republican governor of Michigan and friend of George W. Bush, will be succeeded at the manufacturers' group by its executive vice president, Jay Timmons, a former Republican staffer and fund-raiser.
Mr. Engler, 62 years old, succeeds John Castellani, who had tried to work with the Obama administration on the stimulus, health care, cap-and-trade and other initiatives.
The twin appointments place GOP-leaning leaders at the helm of the capital's three most influential business groups: the Roundtable, NAM and the U.S. Chamber of Commerce.
Mr. Engler, a former Republican governor of Michigan and friend of George W. Bush, will be succeeded at the manufacturers' group by its executive vice president, Jay Timmons, a former Republican staffer and fund-raiser.
Mr. Engler, 62 years old, succeeds John Castellani, who had tried to work with the Obama administration on the stimulus, health care, cap-and-trade and other initiatives.
The twin appointments place GOP-leaning leaders at the helm of the capital's three most influential business groups: the Roundtable, NAM and the U.S. Chamber of Commerce.
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