Debt Financing
Debt financing is a method of raising capital by borrowing money from investors or financial institutions. In the aviation industry, debt financing is commonly used to fund the purchase of aircraft, as well as to finance the construction of airports and other aviation-related infrastructure. Airlines and other aviation companies may issue bonds or take out loans to finance their operations, with the expectation that they will be able to generate enough revenue to repay the debt over time. Debt financing can be a cost-effective way to raise capital, as interest payments on debt are tax-deductible. However, excessive debt can also be a risk, as it can lead to financial instability and bankruptcy if the borrower is unable to make payments.
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