NEWTOWN, Conn., 25 Oct. 2008. Analysts at Forecast International project 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.
The projection is part of a new study from Forecast International titled "The Market for Regional Transport Aircraft."
In the current airline environment, regional airlines are feeling nearly as much financial pressure as the major carriers are, and while regionals can sometimes substantially outperform the majors during times of stress in the industry, this is not the case today, Forecast analysts say.
Analysts say that the airlines have consolidated their routes and grounded aircraft, but did not offload the routes to regional partners. In addition capacity cuts instituted by a number of majors have extended to capacity flown by regional partners.
However slower passenger traffic and higher fuel costs is making operating regional jet aircraft economically unsound, Forecast International analysts say. As a result many regionals are undergoing consolidation rather than expanding into service areas abandoned by the majors, they note.
Despite these factors the market for regional aircraft nevertheless continues to grow. "While the market is certainly not booming, manufacturers are continuing to find opportunities to increase profits and expand market share," Forecast International analysts say. "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.
The Forecast International study predicts that 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, Forecast International analysts say. Bombardier's CRJ regional jet family tops out at 100 seats, but the Canadian firm recently launched the new 100-145 seat CSeries aircraft family.
According to Forecast International Senior Aerospace Analyst Raymond Jaworowski, "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. With the ambitious CSeries project, Bombardier is doing more than playing catch-up to Embraer in the 100-plus seat regional jet market. The CSeries will also directly challenge Airbus and Boeing in the narrowbody airliner market."
ATR and Bombardier are the two leading manufacturers of regional turboprops, and both are busy enhancing their turboprop product line-ups. 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 70-98 seat turboprops. Witnessing the robust demand in the turboprop market, Embraer is considering launch of a family of new turboprop airliners.