Turboprops - How Strong a Come Back?	May 2006

Air Transport World (ATW), a leading publication reach airline industry executives recently hosted an on-line Webcast to discuss the market comeback of turboprop airliners.

Turboprops were the dominant form of regional air transport in the 1970s, 1980s and early 1990s, but many predicted their demise in the late 1990s as regional carriers introduced large numbers of regional jets into the market place.

While the regional jet retains its strong position in specific markets, a growing number of airlines throughout the world are ordering new generation turboprops to upgrade service on existing routes, and launch new innovative services.

Strong interest in the ATW Webcast --- 655 registrants with 272 attendees and another 63 people looking on --- confirms the resurgence in interest in turboprops is being noticed by a large number of airline industry stakeholders.

Turboprops "have made a comeback," said Meridian Aerospace Group President Bill Gardner said. "They've become pervasive again...I don't think operators are turning away from regional jets. I think they're revisiting whether it was a good idea to get rid of turboprops."

Carriers are interested in 50/70-seaters such as the Q300 and Q400 for 60-90-min. flights because they are more cost-efficient on shorter routes. "The turboprop provides Regional operators with a 6% or more cost advantage versus small and medium-sized regional jets," according to Paul Cubillos, director-fleet planning and purchasing for Caribbean Star and Caribbean Sun Airlines. "It just makes a lot more sense to operate turboprops" on flights under 200 mi.

FlyBE Airlines CCO Mike Rutter said the turboprop has "played a great role in transforming [FlyBE's] business," noting that the UK carrier has firm orders for 45 Q400s. "We have a unique and defendable low-cost model" based largely on operating Q400s on flights of 105 min. or fewer, he said.

The rise of the low fair airline phenomenon and the rising cost of jet fuel in the last few years are just two factors driving renewed demand for turboprops, which continue to offer high passenger comfort and low seat-mile costs on regional routes up to 500 miles in length.

The opinions expressed by experts participating in the ATW Webcast mirrors Bombardier Aerospace's long-held position that regional turboprops and regional jets are complementary aircraft products, each suited to their own specific market applications.

In the 1990s, Bombardier invested in the development of two aircraft families in the 37-to-90 seat class --- the Q Series Dash 8 turboprop and CRJ Series regional jets --- to provide airlines with the widest possible choice of regional aircraft.

These investments included the introduction of the Noise and Vibration System (NVS) system in the Q Series family in the mid-1990s, and the launch of the high-speed, low seat mile cost Q400, which can carry up to 78-passengers.

In Canada, start up Porter Airlines has selected ten Bombardier Q400 for a new operation which will begin from Toronto later this year, and Horizon Air of Seattle has re-ordered Bombardier Q400s with plans for a 30 aircraft fleet to serve routes in the Pacific Northwest of the US where it faces low fair competition from several US carriers.

Four new Bombardier Q300 orders have also been received from Caribbean Aircraft Leasing, parent company of Caribbean Star Airlines Limited, based in Antigua, and Caribbean Sun Airlines Inc., based in Fort Lauderdale, Florida.

In Europe, FlyBE's use of the Q400 in the low-cost role has allowed the airline to prosper and differentiate itself from other low-fare and legacy carriers. FlyBE has ordered a total of 45 Q400s.

In the Pacific, Island Air is introducing pre-owned Bombardier Q400s on routes linking the Hawaiian Islands, and Air New Zealand acquired 17 new Bombardier Q300s to replace its Saab 340s. Qantas recently introduced the first of seven Bombardier Q400 in Australia, and Japan Air Commuter and All Nippon Airways (ANA) has placed several repeat orders for Q400s.

The newest Asia turboprop operator, Jeju Airlines of South Korea, receives their first Bombardier Q400 this month.

In the past 12 months, the Bombardier Q400 also entered service in the Middle East with Royal Jordanian Airlines, and in Africa with South African Express.

To view full webcast, please visit: http://atwonline.com/webcasts/index.html