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Monday, July 24, 2006

Dateline Farnborough

The trade and mainstream media tend to lapse into "pack journalism," and the coverage of this year's Farnborough International Air Show is no exception. Reading the press coverage of this biannual confab, you'd get the distinct impression that the only players in aviation are behemoth manufacturers, such as the eternally squabbling Boeing and Airbus. But the fact is, the regional airline industry is alive and well and making its presence keenly felt here.

Here's a concise wrap-up of regional aviation news from the July 17-21 Farnborough show, with our own analysis. Also check the Farnborough "daily news feed," archived at http://www.aviationtoday.com.

ATR

Fincomm Airlines has ordered three ATR 72-500s, which converts three of the eight options it holds for ATR's 500 Series to firm orders for the larger aircraft. The conversions are for delivery starting in 2007, according to the airline. Fincomm's projected ATR fleet will be four 42-500 and seven 72-500s, with an additional five options remaining. The order is valued at $54 million and deliveries are scheduled for the 2008/2009 period.

ATR and Indian regional operator Kingfisher have reached a Global Maintenance Agreement, the maintenance services package ATR offers to operators, for spare parts and maintenance for the ATR 72-500. Under the 10-year, $50 million agreement, ATR will handle the repair of equipment and line replaceable units, plus an inventory of spare parts and engines on lease at Kingfisher premises, as well as the airframe maintenance checks and the maintenance of propellers and landing gears. Through this agreement, ATR will cover a range of maintenance services for the 35 ATR 72-500s fleet already ordered by Kingfisher.

BAE Systems

BAE Systems Regional Aircraft leased two ATPs to Enimex Airline in Estonia. The first was delivered early this month and the second is scheduled for mid-August. Enimex, an aircraft, crew, maintenance, insurance and charter operator, is the seventh new customer for BAE for 2006. The ATP will be the first western aircraft for the company.

BAE also sold a Jetstream 41 to Florida-based K-Tractor, a leading provider of aftermarket tractor replacement parts for Komatsu equipment. It will be used in executive configuration to transport employees throughout the south.

During the first half of this year, the company sold 17 more Jetstream 32s and is predicting it will sell 30 for the year. Calgary-based QuikAir took two 12-seat 32EPs, purchased through DAC Financial, while Alberta CityLink, also of Calgary, purchased and leased two aircraft, adding them to its fleet of nine. In addition, Trasmandu of Venezuela purchased two, the first of which was delivered in March with the second scheduled for October. Also in Venezuela, Pro-Flight added a second aircraft used for charter flights.

International Aircraft Systems ordered three Jetstreams, including one delivered in June with the balance set for delivery this summer. Eastern Airways of the U.K. extended leases on two of its four 18-seat Jetstreams, while Blue Islands (formerly Rockhopper) of the Channel Islands bought a third aircraft, delivered earlier this year for flights between the islands and the UK mainland.

Tamir Aviation, the first Israeli operator, accepted a second Jetstream during the first quarter. Sanford, Fla.-based Vertical Aviation added a 32EP to its four- aircraft Jetstream fleet used for charter flights for Colombian oil companies. Corporate Flight Management of Smyrna, Tenn. purchased two, adding them to its fleet of 18 aircraft, including eight Jetstreams. It operates the largest Jetstream corporate shuttle fleet.

The Regional Aircraft division currently manages a portfolio of 295 BAE aircraft, valued at over $1 billion, including 66 BAE 146s, 82 Avro RJs, 40 ATPs, 40 Jetstream 41s and 67 Jetstream 32s since its founding in 1993. Since then, it has done 1,400 portfolio transactions worth more than $2.6 billion, including new leases, lease extensions and aircraft sales.

Bombardier

Horizon Airlines converted one of its options for a Bombardier (BBD) Q400 in a deal worth about $25 million. Horizon Air has now ordered a total of 31 Q400s, as well as 28 Q200 turboprops and 20 CRJ700 regional jets from the manufacturer. The airline has also acquired two additional previously owned Q400 aircraft from Hainan Airlines. As of April 30, 2006 Bombardier had firm orders for a total of 177 Q400 aircraft, with 118 delivered to operators worldwide.

Bombardier and Shenyang Aircraft Company (SAC) have signed an agreement calling for SAC to produce fuselage sections for the Bombardier Q Series turboprops. The agreement covers the forward and aft fuselage and the aft empennage work. The move transfers work now done by Mitsubishi Heavy Industries all of which will gradually move over to SAC. The company currently produces the doors for the Bombardier turboprops. It was also set to produce the fuselage for the now-tabled C-series

United Aviation of Libya has ordered one super midsize Challenger 300 and a high-speed Global 5000. The new executive charter company, based in Tripoli, is the company's first customer in Libya. The deal is worth about $55 million.

The announcement caps a strong week of orders for Bombardier Business Aircraft. On Tuesday, VistaJet of Switzerland placed a firm order for three wide body Challenger 605 jets, while two orders for Learjet 60 XR aircraft were placed by Nove Holding of Bulgaria and a customer from the Czech Republic. Bombardier also announced the order of a Learjet 45 XR super-light jet by the Government of Sindh, the launch customer for Pakistan, and VistaJet signed a contract for a Global Express XRS ultra-long range business jet. Based on the list price for typically equipped aircraft, the tally for this week's announcements is valued at over US$220 million.

Cessna Mustang

Hard on the heels of the Cessna Citation Mustang's first flight on June 15, Cessna reported, with more than 1,400 total flight hours over 850 flights, the Mustang is on track for certification later this year. The three aircraft are being tested to commercial airliner standards, taking fatigue testing to five lifetimes or 75,000 hours.

To date, certification tests have been completed including the flight envelope expansion to maximum airspeeds, aircraft stability and control, environmental chamber testing from minus 40 degrees to 120 degrees Fahrenheit, as well as static fatigue testing, autopilot certification and climb certification. Tests underway include natural icing (flight into known icing) Garmin G1000 avionics, aircraft performance and engine handling and operation.

Cessna reported that more than 3,100 hours have been accumulated on the Mustang's Pratt & Whitney Canada PW615F dual-channel FADEC engine. Pre-certification development is complete on the engine, which has been certificated in Canada. Finally, static testing is more than 95 percent complete while the main landing gear surpassed its goal of 75,000 landings. The nose landing gear has 45,000 landings out of 75,000.

In addition to FAA certification this year to Part 23 standards, Cessna expects certification by the European Aviation Safety Agency (EASA) in the second quarter of 2007. Cessna says it has booked nearly 250 orders and the production is now sold out into the third quarter of 2009. Approximately 60 percent of orders are from outside the U.S. with 30 percent destined for European operators. It now has 15 Mustangs in production. The six-seat business jet is expected to cruise at 340 KTAS and maximum operating altitude of 41,000 feet.

Embraer

Central European Aerospace (CEA) was tapped by Embraer (ERJ) as is authorized sales representative for the Czech Republic, Slovakia and Hungary for its business jets - Legacy 600 and Shuttle and Phenom 100 and 300. Based in Prague, CEA brings 10 years experience in the business jet industry with comprehensive activity in acquisition, management and operations.

Embraer also announced its executive jet orderbook including the mid-size Legacy 600, the very light and light Phenom 100 and 300 and the ultra-large Lineage 1000. It expects to deliver 25 to 30 Legacy 600s per year in 2006 and 2007 and boasts a market share of 13.5 percent, having delivered 76 aircraft to customers in 18 countries. The company will begin deliveries of the Phenom 100 in 2008. By the end of that year, it expects to have 15-20 units in the field. The Phenom 300 will follow in the second semester of 2009 when deliveries of the two light jets will reach 120-150 units combined. The company has booked firm orders for 235 Phenoms, including JetBird's 50-aircraft order for the 100 Series. Delivery of up to two Lineage 1000s is anticipated for the second semester of 2008, its first production year, with four Lineage 1000s planned for 2009 delivery.

The Phenom100 just completed wind tunnels tests at the University of Washington Aeronautical Laboratory, Brazil's General Command for Aerospace Technology (CTA) and the Central Aerohydrodynamic Institute in Russia. All three phases confirmed the expected characteristics and design specifications of the aircraft. Embraer also had the first engine run of the Pratt & Whitney Canada PW617F engine set to power the aircraft, demonstrating overall system functionality and verifying engine performance and operability. The development engine ran at its full takeoff thrust of 1,695 pounds. This launches the qualification test program, which includes individual component rig testing to complete in-flight performance demonstrations leading to engine certification in the fourth quarter of 2007.

Embraer has booked three orders from KIPCO Group's United Aviation, which ordered one each of the Phenom 100 and 300 as well as a Legacy 600 for a total value of approximately $34 million. United is one of the leading VIP charter operations in the Middle East and North Africa and is now the Phenom's launch customer in the region. The contract calls for the Phenom 100 and 300 to be delivered in 2008 and 2010, respectively, while the Legacy is scheduled for delivery in October 2006. United already has two Legacies in its fleet.

FAA, EC

The Federal Aviation Administration and the European Commission signed a Memorandum of Understanding (MOU) calling for enhanced cooperation in building a more efficient and seamless air traffic system and focusing on building bridges between the Next Generation Air Transport System (NGATS) and the EC's Single European Sky Air Traffic Management Research (SESAR) airspace modernization program. The agreement calls for the identification of opportunities and timelines for the implementation of common, interoperable, performance-based air traffic management systems and technologies. It will concentrate on regulation, standards and procedures, coordination with international organizations, research and development as well as civil and military air traffic management issues.

Pratt & Whitney Canada

In a contract valued at $60 million, Kingfisher also signed a five-year agreement with Pratt & Whitney Canada (PW&C) to maintain engines on its ATR 72 fleet. PW&C will provide engine maintenance and accessory coverage for the 70 PW127F engines as well as seven spare engines. This includes hot section inspections (HIS), overhauls and basic unscheduled removals. The HSI will be established by year-end and the engine manufacturer hopes to leverage its dedicated, on-site representatives to support the growing number of commercial and corporate operators in India.

PW100 deliveries jumped nearly three-fold in the past two years, amid rising airline orders for turboprop aircraft. "More than 160 aircraft powered by the PW100 engine family were ordered in 2005," said Keyvan Fard, vice president, regional airline and turboshaft engines. The engines power the ATR aircraft as well as the Bombardier Q series. Fard indicated recent demand is especially strong in southeast Asia, the Pacific and Europe.

328 Support Services

328 Support Services GmbH and GCT Design Organization received approval from the EASA for GCT to take over design organization authority for the Dornier 328 Jet and Turboprop. 328 Support Services remains the type certificate holder. GCT employs 35 of the engineers who worked on the 328 programs, in addition to 13 subcontract engineers. It is responsible for technical publications and service bulletins. The company partnership is designed to ensure long-term support for the Dornier 328s in operation around the world. 328 Support Services is in the process of reorganizing its maintenance capability into a dedicated maintenance center registered at JETS GmbH, complementing its UK-based sister company JETS UK Ltd.

Sukhoi

Sukhoi Civil Aircraft Company renamed its 75-seat and 95-seat regional jets the SuperJet 100, according to a new advertising campaign appearing at Farnborough. (RAN, June 5. p.4) The aircraft are being produced under a partnerships with Alenia which owns 25 percent of the company. Engines are being supplied by risk-sharing partner PowerJet which is producing the 14,000 to 17,500 thrust SaM 146. Boeing has been a consultant on the project, which began five years ago, working on market research, product development and customer support. The first flight of the 98-seat RRJ95 is slated for September 2007, with construction of its four test aircraft now underway.

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