AvCraft Aviation of Leesburg, Va., hoping to become a niche player in the regional jet market, is set to restart production of the former Fairchild Dornier 328JET in Germany soon. With production to begin in the first quarter of this year, the first completed 30-seat 328JET is expected to roll off the assembly line by the fourth quarter of 2004.

"It is not our intention to compete on the basis of outright airframe deliveries in the regional jet market," AvCraft Chief Executive Ben Bartel said. "Our market is clearly a niche, and we are happy to be a niche player. The unique characteristics of the 328JET mean that we can offer our operators outstanding economics without any operational penalties within the airline, corporate and special missions applications. However, our focus is all about support and how we can be a solid investment and overall excellent business tool for our operators and end users."

Bartel said AvCraft is responding to market demand. All but two of the 18 "white tail," or unsold, aircraft that the company inherited when it purchased the rights to and facilities of the 328 program in December 2002 have been sold, he said. Fairchild Dornier collapsed in March 2002, ending production of the 328JET and 728 regional jet families.

The Dornier 328JET is a two-engine, high-wing regional jet. It is a re-engineered version of Dornier's Do328 turboprop aircraft and, when the program was launched in February 1997, it was one of the first 30-seat regional jets on the market, competing with the Embraer [NYSE: ERJ] ERJ-135. The first flight of the 328JET took place in January 1998 and the aircraft received U.S. and European certification in August 1999. The first deliveries took place later that month.

Nearly half of AvCraft's current orders are from non-airline customers, the company said. AvCraft did not say how many orders it currently has, but published reports indicate it has 45 orders and firm prospects. AvCraft said it will be expanding its manufacturing workforce by up to 425 at its Oberpfaffenhofen, Germany, facility as it works up to a production rate of 18 aircraft per year.

Work will begin on five unfinished aircraft on the Oberpfaffenhofen assembly line. These aircraft are between 20 percent and 80 percent completed. In addition, eight stored Dornier 328 turboprops will be brought back into service. "We see the turboprop as a great ambassador for the 328 program and feel it compliments the jet," Bartel said.

After taking control of Fairchild Dornier, AvCraft immediately began supporting customers in the United States, who account for more than 40 percent of the worldwide fleet of 200 328s. In December, the company signed a three-phase, six-year agreement with BAe Systems [PNK: BAESY] to handle parts warehousing and distribution (CRAN, Jan. 5).

AvCraft also completed the acquisition of Fairchild Dornier 328 spare parts assets from M7 Aerospace in San Antonio, Texas, along with maintenance tooling, ground support equipment and 328 Special Transport Certificates for an undisclosed sum (CRAN, May 26, 2003). The spare parts will be relocated to BAe Systems' Herndon, Va., facility as well as AvCraft's new service center in Myrtle Beach, S.C.

"We look forward to being of service to AvCraft and in providing a high level of spares support for Dornier 328 and 328JET customers," said David Speirs, BAe's senior vice president of American support for regional aircraft. "We hope to build on this initial agreement with AvCraft and future collaborative support possibilities look exciting."

European customers will be supported from AvCraft's parts and product support facility at the Oberpfaffenhofen factory. The company's designated sales and service partner, Aero Dienst in Nurnberg, Germany, will offer maintenance support. >>Contact: Kelly Murphy, Emerald Media, 703-716-0503, email: USEmerald@aol.com.<<