UK regional carrier Flybe is cancelling orders for 20 Embraer 175s in favour of a lease agreement to take 24 Bombardier Q400s from US operator Republic Airways, which is to purchase 50 E-175s to operate for United Airlines.

The arrangement is part of a multi-party fleet deal after Republic amended its Shuttle America capacity-purchase agreement with United.

Republic will add 50 Embraer 175s, with 76-seat capacity, under the revised United agreement, and has agreed a purchase with the Brazilian airframer. It will also extend the terms of its 38 Embraer 170s to dates between September 2019 and December 2022.

But the United agreement also enables Republic to start winding down 31 Q400s. Flybe is intending to sub-lease 24 of these aircraft after they are removed from United service starting in January next year.

These Q400s will, in turn, be introduced to the Flybe fleet in place of 20 Embraer 175s.

Flybe has 24 of the E-Jets still on order, which it describes as a “legacy” fleet commitment. The jets were part of a firm order for 35 – which included options and rights for another 105 – placed in 2010.

But only 11 have been delivered to the UK operator, which has been undergoing a restructuring programme. Flybe had already pushed back deliveries of the remaining 24 until next year.

Under the new Republic arrangement, Flybe says it will “terminate” its order for 20 of the outstanding 24 Embraers. The other four jets will be deferred until 2018.

The 24 Republic Q400s, fitted with 71 seats, will be delivered from March 2015 and will be introduced over a two-year period.

“We are committed to flying the right aircraft on the right routes,” says Flybe chief Saad Hammad, who adds that the Q400s are “attractively-priced” and will ensure that the UK fleet is “right-sized to our capacity growth”.

The net cost of the fleet renewal is “broadly in line with our expectations”, he adds.

Republic says the remaining Q400s from the batch of 31 being withdrawn will be sold, leased or returned to their lessor. The turboprop removal will be completed in September 2016.

Its first Embraer 175, from the 50 being acquired, will arrive in July 2015 and deliveries will continue until August 2017. The aircraft will have 12-year terms under the United capacity-purchase agreement.

Source: Cirium Dashboard