Today I introduced new legislation which will provide Australian airlines with access to lower cost finance for aircraft purchases.
The International Interests in Mobile Equipment (Cape Town Convention) Bill 2013 gives legislative effect to the Cape Town Convention, which I announced Australia would sign up to in October last year.
By acceding to this convention, Australian airlines of all sizes will be able to access cheaper finance when purchasing aircraft, jet engines or helicopters.
It is estimated that Australian airlines could save in the order of $2.5 million on the purchase of a new Airbus A380 and airlines operating smaller aircraft could save around $330,000 on the purchase of a new ATR72 aircraft – like those flown by Virgin Australia.
Discount financing will also be available for purchases of second hand aircraft which will help smaller regional airlines upgrade and maintain their fleet.
Ultimately, these changes will help reduce risk for creditors, give Australian airlines access to a wider variety of sources of finance and provide greater certainty for the aviation industry.
They will also enable airlines to accelerate the move to safer, more fuel efficient and environmentally-friendly fleets.