Across Australia's vast and far-flung regions, many people naturally rely on air transport to get around, and many of those services rely on ageing turboprops and regional jets. Indeed, Cirium's Fleets Analyzer shows that Australia's 300-strong regional aircraft fleet has an average age of just over 23 years.
Tellingly, the most-used aircraft is the Saab 340, with 61 in passenger service, followed closely behind by the Fokker 100, with 57. But while the country’s regional fleets are showing their age, new aircraft have proved to be a hard sell.
Dutch-built Fokker jets illustrate the challenging nature of Australia's regional air service market. F100s and F70s have long been out of service in other parts of the world, but in Australia they are a mainstay for fly-in, fly-out charter operators such as Alliance Airlines, Qantas’s Network Aviation unit and Virgin Australia Regional Airlines.
As European operators Austrian Airlines and KLM withdrew their fleets of F100s and F70s, Australian carriers took advantage of relatively low purchase prices, which helps offset the types' high operating costs.
Alliance managing director Scott McMillan tells FlightGlobal that his carrier has no plans in the near future to replace its Fokker aircraft, although its five F50 turboprops could be retired if they were no longer needed. "We are provisioned to operate circa 40 Fokker jets for the next 10 years," says McMillan.
Key to that is a large number of spares amassed by the operator, the expertise of its engineers and heavy maintenance support from KLM UK Engineering and Austrian Technik Bratislava. It has also acquired major stocks of spare parts, spare engines and tooling from other operators.
McMillan adds that it also has a strong relationship with Rolls-Royce, the manufacturer of the Tay jet engines powering F70s and F100s. "Our relationship with Rolls-Royce is absolutely pivotal to ensuring that these aircraft go for the next 10 years," he says.
Regional Express made a similar move some time ago, buying out the spares inventory of US carrier Pinnacle Airlines to support its fleet of Saab 340s – comprising 54 B models in its passenger fleet and four A models flown by its Pel-Air unit on charter and freighter operations, according to Cirium's Fleets Analyzer.
The carrier has had to mitigate some obsolescence issues – for example, replacing its Saab 340 cathode ray tube displays with newer liquid crystal units. That upgrade also allowed for the integration of newer avionics and will keep the aircraft flying for many years.
Not surprisingly, a key consideration guiding Australian regional carriers' fleet choices is the type of service they offer: scheduled passenger or fly-in, fly-out resource charter?
Fly-in, fly-out contracts tend to be short term with low aircraft utilisation, which makes it hard to justify investment in new aircraft.
"If you are just relying on fly-in, fly-out agreements of a few years with low utilisation, it is difficult to justify new aircraft unless there is a specific requirement of the end customer. That is what we have found," says ATR's sales general manager for the ASEAN region, Christophe Potocki.
He notes, though, that some operators are starting to run a mix of charter and scheduled operations, blurring the "boundary between fly-in, fly-out and scheduled" services, making it more difficult to see where opportunities lie for aircraft manufacturers in Australia.
For pure scheduled operators that operate multiple segments each day, Potocki says ATR's -600 series has strong economics, while its cabin options can offer passengers a similar experience to a much larger aircraft.
Virgin has had ATRs in its fleet since 2011, initially operated by then-independent carrier Skywest, predominantly on services along Australia's east coast. Freight operator Toll also operates two ATR 42 Freighters, Fleets Analyzer data shows, while Hevilift flies one ATR 42 and one 72 on charter operations.
But ATR's win at getting its products into Virgin has been tempered recently, as the carrier reduced its ATR 72 fleet from 14 to eight as part of a cost cutting exercise to arrest major losses in recent years. At the same time, Virgin dealt a major blow to Embraer, withdrawing the last of its E190s last year. That has left Airnorth as the only E-Jet operator, with five E170s in service that fly both charter and scheduled services.
It is rather telling that as Virgin drew back its regional capacity, it was largely back-filled by Alliance Airlines’ Fokker jets, through a combination of wet-leases and codeshares with that operator.
In theory, high utilisation and its effect on ageing aircraft could push Regional Express (also known as Rex) to replace its Saab 340 fleet – but a number of routes in its network would not support the next best option, which appears to be the 46-50 seat ATR 42. For a carrier that averages loads of around 61% on 34-seater aircraft, those additional seats could be more of a burden than a help.
Potocki notes that the carrier "is doing really well with its existing fleet", but hopes that future growth could see it look to add ATR 42s to its fleet. "I don’t feel that Rex would be looking at replacing all of the Saabs on all of the routes. I don't think it would make sense for them. If there are any routes where there is growth, that could provide some better fit," he says.
Across the ramp, Bombardier has the monopoly on the Qantas group's turboprop fleet, with 31 Q400s, 19 Q300s and three Q200s. Those turboprops are in the midst of a cabin refurbishment programme, which is seeing them fitted with new ergonomic cushioning, leather upholstery, tablet holders and floor coverings. Older Dash 8s also remain a mainstay of carriers including Perth-based charter operators Maroomba Airlines and Skippers Aviation, along with scheduled north Queensland carrier Skytrans.
A number of operators of smaller aircraft, such as Fairchild Metroliners also face a lack of options to replace their aircraft. In some cases, operators have turned to Beechcraft 1900s, but with only nine in the country against 36 Metroliners, and both types out of production, there are few alternatives around.
With the Fokker jet set to be a fixture in Australia for many years to come, regional jet manufacturers are more focused on the major carriers for future sales. But while signs are encouraging, orders still appear to be some time off.
Last year, Qantas signalled that it is evaluating the Embraer E2 series and the Airbus A220 for its future fleet. However, it did not give a timeline of when it was looking to make a decision. The carrier is expected to focus its attention on choosing an ultra-long-haul jet for its "Project Sunrise" requirement this year.
Virgin may also be forced to reconsider the paring down of its regional aircraft fleet due to recent uncertainty over the fate of its wet-lease partner, Alliance Airlines. In February, arch rival Qantas made a surprise strike on Alliance, taking up a 20% stake in the carrier and suggesting that it plans to apply for regulatory clearance to lift its stake and eventually take control.
For its part, Alliance has said publicly that its board has not been approached by Qantas, while getting competition clearance to grow its stake looks to be a long road ahead. Virgin has, understandably, expressed its concerns, but has not signalled any plan to make a play for the independent operator.
McMillan is unfazed by the Qantas approach, and says that even after the stake was bought, Qantas had not held any discussions with Alliance management, which is not changing its long-term plans.
Fellow charter jet operator Cobham has also given no signal that it plans to move away from its fleet of 16 BAe 146s and Avro RJs, despite its youngest one being just under 18 years old, according to Fleets Analyzer. It points to the unique rough- and short-field capability of the type as an asset that is hard to match with more modern types.
So, while Australia's regional aircraft fleet continues to age, many of those aircraft are set to have long lives down under.
Source: Cirium Dashboard