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Turboprops are back

Once unfashionable turboprops are making a revival following a flurry of orders

If, in fashion terms, white is the new black, then the turboprop is the new jet. That was the theme running through briefings by regional manufacturers at Le Bourget.

By the end of the air show, the two producers of turboprops – ATR and Bombardier – had together scored just under 100 orders for their ATR 42/72 and Dash 8 Q Series models this year, while former manufacturer Saab reported renewed interest. This is ATR’s and Bom­bardier’s highest combined half-year intake this decade and 2005 is starting to echo the boom times turboprop builders enjoyed until the mid-1990s, when regional jets put a stranglehold on the market.

Bombardier may have the most to smile about as it is the only regional manufacturer with a firm foot hold in both camps. Having been responsible for the regional jet revolution with its CRJ family, it has been riding the wave of turboprop resurgence, having accumulated over 100 sales of its Q Series models over the past two years.

At Le Bourget, Bombardier vice-president airline marketing and analysis Barry McKinnon said that up until the Paris air show, total turboprop orders for itself and ATR were running only slightly below sales of regional jets by itself and Embraer – 69 turboprops versus 89 jets (in the 20- to 90-seat category). During the show a further 24 turboprop orders were announced, taking overall sales to91 units: further evidence that the market is rebounding.

“Some observers had written the turboprop market off several years ago, but we were always convinced it would come back,” said McKinnon. While he believes that ultimately regional jets will stay ahead in overall sales terms this year, he is confident that the recovery will continue into next year: “Turboprops are back,” he said.

After announcing 20 new orders for the 48- and 72-seat ATR 42-500s and ATR 72-500s during the show, with eight options, ATR chief executive Filippo Bagnato said the deals “represent the confirmation of a positive trend”. Sales comprised eight firm orders and eight options from Finnair regional partner Finncomm, three each from Air Calédonie and Air Madagascar and six from Corse Méditeranée, in addition to February’s landmark order for 30 ATR 72-500s from India’s Air Deccan.

The trend towards the rebirth of turboprops is driven by three factors, said Bagnato: “Increased traffic growth, the fight for ticket price and the high oil price are all pushing operators towards lower cost of operations.” With quieter engines, modern turboprops provide the same level of comfort as regional jets, but are cheaper “not only at the time of acquisition, but throughout the life of the aircraft through the total cost of operation”. He said operators on short- and medium-range routes are looking seriously at the turboprop option again. The upswing in demand has led to ATR increasing production from 15 this year to 20 next year and 24 in 2007.

During the show Bombardier announced four more Q400 orders from Exeter, UK-based Flybe, now the largest customer worldwide for the Q400. The UK low-fare regional airline also placed a major order for Embraer’s 118-seat E-195. But Flybe chief executive Jim French reiterated that, for its lower-capacity routes, the future lies with propeller-driven airliners.

Competing in both sectors, Bombardier is well positioned to explain a turboprop’s advantages over a regional jet. It says that over a 320km (175nm) sector in the US airline environment, a turboprop offers a cost of advantage of 14-80%, depending on the criteria:

* 14% lower crew costs;

* 18% lower capital costs ;

* 20% lower airframe weight-related costs; - 26% lower airframe maintenance costs; - 28% lower fuel consumption;

* 83% lower engine maintenance costs.

Comparing the 74-seat Q400 with its own similarly sized CRJ700, Bombardier said that the turboprop’s economics are “unbeatable on shorter sectors”. Again assuming a 320km sector, with an average fare of $45, Bombardier said that the Q400 has 36% lower cash operating costs (equivalent to $98,000 a month at ¢39/litre ($1.50/USgal) of fuel) and it can break even with eight fewer passengers a flight – 2,194 fewer passengers a month.

Although Embraer appears to have the top end of the large regional jet market to itself, the turboprop resurgence has forced it to look at ways of improving the competitiveness of its ERJ-145 family of small jets by “squeezing the costs so that it becomes attractive in the turboprop operating environment”, said Embraer market intelligence director Orlando Neto.

Market revival

Saab may have been one of the casualties of the near-demise of the turboprop in the late 1990s, but with over 400 Saab 340 and 2000s still flying worldwide, it is encouraged by the revival of the market.

“Turboprops are back in fashion, especially in Europe,” said Saab Aircraft Leasing president and chief executive Michael Magnusson, pointing to a strong first quarter for the division, which placed 16 aircraft with several operators. These include two more Saab 2000s with Romania’s Carpatair, delivered in May and June, and two additional aircraft for the UK’s Eastern Airways, delivered in March.

Saab Aircraft Leasing vice-president sales and marketing Dag Waldenstrom said the 50-seat regional jet has “reached its peak” in Europe. He added the needfor short-field capability, notably for London City Airport and Switzerland’s Lugano, makes turboprops more attractive to European airlines than their counterparts in North America, which has fewer city airports.

MAX KINGSLEY-JONES & JUSTIN WASTNAGE/PARIS

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