Concerns over turboprops, resulting from the Colgan Air crash, seemed to be abating but are now taking an ominous turn that could threaten the popularity of turboprops just as another investigation did in the mid-1990s. Turboprops could take the same devastating hit they did at that time resulting from the ATR-72 crash in Roselawn, Ind. which decimated turboprop order-books.

That scenario seemed highly doubtful since the aircraft passed tests simulating the icing conditions that felled the ATR-72. Related Story However, the National Air Disaster Alliance/Foundation unearthed former Department of Transportation Inspector General Mary Schiavo, who was such a thorn in the side of the entire aviation industry in the mid-1990s, to support their suit against the Federal Aviation Administration and DOT to force FAA to move faster on National Transportation Safety Board safety recommendations, specifically on icing. The suit was filed in U.S. District Court in Washington, and cites the agency’s failure to act in an Embraer Brasilia crash in Monroe, Mich. in 1987 and a Cessna Citation business jet crash in Pueblo, Colo. in 2005.

The onslaught this time began with former NTSB Chair Jim Hall calling for the grounding of all turboprops which was met by fierce opposition by the NTSB member in charge of the investigation, Steven Chealander. Coverage failed to report that Hall is now an attorney hawking for business by putting editorials against turboprops in the Buffalo News.

The lawsuit constitutes a second round of attacks and comes on the heels of news coverage questioning regional. The suit, which names DOT Secretary Ray LaHood and FAA Acting Administrator Lynne Osmus, is right on time, coming less than two weeks after the Continental Connection crash, just as similar efforts by a company that sold airline ticket insurance and an ATR 72 pilot gave the Roselawn story new legs just as the crash coverage was dying down to await probable cause pronouncement by the NTSB. In 1994, so much pressure came from such groups that the FAA nearly grounded the ATR 72, restricting its operation in icing conditions, which effectively grounded the craft, and sent the industry into chaos as it tried to replace the lift.

But at least one company does not think turboprops will be down for the count, according to a new report issued by Forecast International. Despite the unusual uncertainty surrounding regional airlines, Forecast International sees a bright future for their manufacturers, which over the next decade will retain their market share despite several new entrants. This is not surprising since the aircraft produced by Mitsubishi, AVIC and Sukhoi will only come on the market in the next four years and will take time to gain market acceptance.

The Market for Regional Transport Aircraft, projects that a total of 4,066 regional aircraft worth $116 billion will be produced from 2008 through 2017. The total includes 2,826 regional jets and 1,240 regional turboprops.

“Against this tumultuous backdrop, the market for regional aircraft nevertheless continues to grow,” said Forecast International. “While the market is certainly not booming, manufacturers are continuing to find opportunities to increase profits and expand market share. Regional turboprop airliners are experiencing a marked resurgence in demand, particularly for those models seating 70 passengers. Meanwhile, demand for regional jet airliners has been shifting upward to larger-capacity aircraft. As airlines increasingly park inefficient 50-seat regional jets, many of these aircraft will be replaced by 70-seat and larger aircraft.”

Forecast International predicted the top three regional aircraft manufacturers during the 2008-2017 time period will be Embraer, Bombardier, and ATR. Embraer is projected to build 1,440 regional jets valued at $47.1 billion. Bombardier is expected to produce 1,189 regional aircraft, including both jets and turboprops; the value of this production is estimated at $41.5 billion. ATR is forecast to build 458 regional turboprops valued at $8.3 billion.

Embraer’s regional jet product line stretches out to 122 seats, putting the Brazilian company in an excellent position to exploit the growing demand for ever-larger regional jet aircraft, said FI. “Bombardier had been vulnerable to changing market dynamics at the top end of the regional jet market, and the CSeries is an attempt to address this vulnerability,” said Forecast International Senior Aerospace Analyst Raymond Jaworowski. “With the ambitious CSeries project, Bombardier is doing more than playing catch-up to Embraer in the 100+ seat regional jet market. The CSeries will also directly challenge Airbus and Boeing in the narrow-body airliner market.”

Forecast International pointed out the robust attitudes for the two remaining turboprop manufacturers. “ATR and Bombardier are the two leading manufacturers of regional turboprops, and both are busy enhancing their turboprop product line-ups," said Forecast International. “Bombardier is marketing an improved version of its 70-seat Q400, called the Q400 NextGen, and is considering launch of a 90-passenger variant of the aircraft. ATR is developing improved -600 versions of its ATR 42 and ATR 72 turboprops, and the French/Italian company has also initiated design studies on a possible new family of 70- to 98-seat turboprops. Witnessing the robust demand in the turboprop market, Embraer is considering launch of a family of new turboprop airliners.”

Despite the fact that the usual pattern that the regional segment benefits from hard economic times has evaporated in the current economic environment, Forecast International suggests that aircraft manufacturers will find new opportunities in the coming years. Indeed, to date, they have not followed their major airliner counterparts in announcing deferrals or cancellations, so there may be something to Forecast International’s theory.

Even so, it remains to be seen how long the major-carrier cuts, which have forced block hours below contract minima, will impact the regional segment and, whether there will be a new role created with their aircraft. In the current airline environment, said Forecast International, regional airlines are feeling nearly as much financial pressure as the major carriers, and while regionals can sometimes substantially outperform the majors during times of stress in the industry, this is not the case today.

It predicted that economic contraction could force regionals to undergo significant contraction. However, it is unclear whether this could also mean consolidation, which seems to have fallen out of favor as a method of survival in hard economic times. The increased movement toward such activity only 16 months ago has only resulted in a single merger, Delta/Northwest. For their regionals, it largely means a rationalization of feeder systems, the impact of which continues to unfold.

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