ATR, Bombardier and Embraer bullish on India growth

Plane makers pin hopes on regional connectivity scheme and airlines expanding their fleets

Plane makers ATR, Bombardier and Embraer are bullish on growth in India with the rise in air travel in tier II and III towns and the government thrust on regional connectivity.

These plane makers primarily cater to the regional aviation  market with their 48-110 seater aircraft. Currently ATR has the largest presence amongst the three in India with 35 aircraft in service with four scheduled airlines. Bombardier and Embraer have 15 and 3 aircraft in service  with a single operator each.

Demand is expected from both existing customers and new airlines as the civil aviation ministry proposes to link 350 unused airstrips in country and state governments  encourage airlines to start operations to tier II and III towns. Last year domestic air traffic grew over 20 per cent and the government expects new wave of growth to come from smaller towns.

The government  initiatives present opportunities for manufacturers of small planes such as ATR, Bombardier and Embraer. While turboprops such as an ATR-72 or a Bombardier Q-400 aircraft are better suited  to serve short distance low traffic routes, mid size jets like Embraer E-190 (flown by Air Costa) are designed for long distance low traffic routes. The operating costs of a  jet aircraft is higher than turboprop plane and hence it is more economical to operate them on longer distance flights.  

“There will be some additional deliveries in India within the next months,” said an ATR spokesperson in an emailed response. “India is very promising market. ATRs are optimally positioned to link middle sized and small sized towns while contributing to feed main hubs,” the spokesperson added.

"The potential new policy in India to boost regional connectivity can open up routes that currently do not have non-stop flights. This figure currently stands at around 40. This would be a very positive development for travellers in India," said Mark Dunnachie, Vice President, Asia Pacific, Embraer Commercial Aviation 

In the last two years regional airlines including Air Costa, Trujet and Air Pegasus have commenced operations while companies like Air Carnival and Flyeasy are awaiting government nod to start services.

Air India's regional arm Alliance Air plans to induct ten ATR-72 aircraft on lease till next March. Regional airline Trujet plans to increase its current fleet size of three ATR-72s to eight planes by December-end and is launching service to Kadapa which is not served by schedule airline at present. “We are launching Hyderabad-Kadapa flight today. Service between Vijaywada-Kadapa and Vijaywada-Tirupati will start in May  with viability gap funding from Andhra Pradesh government,” said Trujet chairperson V Umesh.

Regional airline Air Costa will add four Embraer E-190 aircraft to its existing fleet of three planes and SpiceJet which operates 15 Bombardier Q-400 aircraft is looking to expand fleet and grow its services on regional routes.

"Regional connectivity rests on three pillars- right aircraft, right airport, and sufficient demand," says aviation consultant Anurag Jain. Currently the  average flight duration of main airlines in India is around 90-100 minutes while regional routes are typically less than 75 minutes which are economically served by turboprop aircraft, says Jain.