Air Canada, under the Canadian version of bankruptcy re-organisation, is leading the way for Star Alliance allies Austrian Airlines, Lufthansa and SAS Scandinavian Airlines in defining their requirements to jointly buy regional jets.

Air Canada is keeping alive prospects of a major small-jet purchase based on the first joint specification set by alliance members. Star has said it may buy as many as 200 jets from more than one manufacturer. Although the group sets the details of the aircraft, each airline has to negotiate its own deal.

Air Canada wants up to 100 jets to fill the gap between its 50-seat Bombardier regional jets, of which it has 35, and the 120-seat Airbus A319, of which it has 47. Around 60% of Air Canada's domestic flights carry fewer than 100 passengers. The airline recently flew in about 120 elite-level frequent flyers, travel agents, and other preferred customers to show off the five models under consideration, asking customers to rate each for comfort and other consumer preferences.

Air Canada demonstrated Boeing's 112-seat 717-200, on loan from AirTran Airways, while Airbus borrowed a 112-seat A318, the first of the model in service with Frontier Airlines, to show off the aircraft to Air Canada.

Embraer brought its 70-seat ERJ-170 demonstrator, as Bombardier showed its 70-seat CRJ-700 and 86-seat CRJ-900 in Star Alliance livery.

Financing will be as much of a factor as flyer preferences or even fleet commonality, admits Air Canada. That could tend to work to the disadvantage of fellow Canadian firm Bombardier, which cannot use government export financing for a sale to a domestic company.

The order could be placed near year-end, for delivery in 2005, or even earlier, says Air Canada chief Robert Milton.


Source: Airline Business