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At RAA Convention: Demand for new commercial tprop programs grows

Written by thomas · Filed Under Aeronautics News 

May 21, 2012

thomas

Prospects brighten for turboprop programs

Minneapolis, MN, May 21, 2012 — In a soon-to-be-released study on the future prospects for turboprop aircraft, findings show a continuing demand for turboprops as well as increasing values for used aircraft. Sponsored by Saab Aircraft Leasing, Aerocentury and Commutair, the study also found that while the current fleet can meet the short-term demands for turboprop aircraft, there is an increased interest for new programs at both ends of the seating spectrum to replace thousands of aging turboprops and regional jets in the worldwide fleet.

The study, authored by long-time regional airline experts Tulinda Larsen and Kathryn Creedy, provides an update for the turboprop aircraft market, investigates mission profiles, fleet demographics, aircraft programs, forecasts demand for turboprop aircraft and provides a discussion on the future opportunities for turboprop aircraft.

“The study confirms what airlines such as Cape Air, SeaPort Airlines, Commutair and Great Lakes Airlines have been saying for years and what new entrant GLO Airways has found,” said study Co-Author Tulinda Larsen, who has been analyzing the industry for decades. “There are markets out there that can be economically served by turboprop aircraft, demonstrating a need for a new generation of turboprops. The significance is, the advent of new, small turboprops could mean the return of air service to many communities. Only Cape Air has gone so far as to actually work with a manufacturer to develop a product but all indications are that it could be successful given the number of turboprops in need of replacement.”

Resurgence in the demand for turboprop aircraft has been spurred because turboprops are the best aircraft for short-distance flights and for challenging operating environments. Factors including volatile fuel prices, additional security fees and increases in overall airline expenses, coupled with declining remuneration in capacity purchase programs, have made operating jets uneconomical on short routes.

“While regional jet values have plummeted, turboprop values have remained robust,” said Co-Author Kathryn Creedy, who has covered the industry since the 1980s. “Companies, such as Saab Aircraft Leasing, have done a masterful job of serving the needs of regional airlines as evidenced by such actions as Silver Airways replacement of its fleet of Beech 1900s with the Saab 340. In addition, airlines are cobbling together expensive mini-manufacturing operations and life-extension programs for turboprops — especially those 36-seats and below — to squeeze life out of the installed fleet of turboprops in all sizes. That bodes well for new aircraft programs that can meet the demand while keeping seat costs reasonable.”

Annual deliveries of turboprop aircraft have been on an uptick since 2005, according to the study analysis. Deliveries in 2011 were more than seven times that of deliveries of the lowest point, 2003. Turboprop deliveries have returned to the 1990s levels with a backlog of more than 400 aircraft.

Today, there are 23,000 turboprop aircraft in active operation around the globe, accounting for half of the world’s aircraft fleet. Of these, 9,000 aircraft (40%) are in scheduled and non-scheduled airline service. The remainder is used in business aviation (8,000 aircraft, 34%) and government (6,000 aircraft, 26%). Turboprop aircraft mission profiles include scheduled air transportation, business aviation and new missions including serving as platforms for exploration and surveillance.

Turboprops are a vital part of the global aircraft fleet. Policymakers, financiers, manufacturers, and operators need a clear understanding of the turboprop market dynamics to develop strategic plans for future products.

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