'ATR is a wellknown and competitive airplane in India'

When compared with jetliners, the turboprop airliners offer better fuel efficiency. The potential of regional aviation in India is also high. The existing low-cost carriers and the new regional airlines emerging on the civil aviation scene are expected to invite bids from turboprop manufacturers to either commence operations or replace the existing fleet of regional aircraft. Indeed, the turboprop market is booming and ATR is definitely in the lead. Filippo Bagnato, Chief Executive Officer, ATR, speaks to Vasuki Prasad of SP’s AirBuz on products from ATR and the Indian market.

SP’s AirBuz (SP’s): How do you see the prospects for ATR in the Indian market?

Filippo Bagnato (Bagnato): India is growing and there is still untapped potential for further introduction of commercial aircraft. The number of airplanes in India is still limited with some 400 commercial aircraft, including some 50 regional planes. This is not much when compared to over 1,300 regional aircraft in North America, which has a lesser population. In India’s regional market, ATR is already well positioned with a market share of some 66 per cent of all regional aircraft. The connectivity between small and medium-sized communities is still to be deployed. ATR is a well known and competitive airplane in India. The operating environment in the region is very challenging with high operating costs and low average yields.

SP’s: What are the prospects for the year 2013 in India for the ATR 72-600 aircraft?

Bagnato: We are currently introducing the very first ATR 72-600 in India with Jet Konnect and we are in discussion with other airlines in order to further expand the presence of our aircraft in the region.

SP’s: How would you compare the ATR 72-600 with its competitors in the turboprop segment?

Bagnato: We propose the regional aircraft which feature the most advanced technologies, passenger comfort standards and the least operating costs. The ATR 72-600 features up to 40 per cent less fuel consumption when compared to other 70-seat turboprops, which is a substantial advantage when fuel represents some 50 per cent of the operating costs in India. The ATR 72-600 is the most recently certified regional aircraft in the market. Its flight deck features leading-edge technologies inspired from that of Airbus’ A380, the world’s largest commercial airliner. Special care was devoted to the new Armonia cabin offering lighter and more comfortable seats, wide overhead bins, mood lighting and a new cabin management system. These technological improvements lead to an increased operational flexibility, easier crew handling, higher comfort level and reduced maintenance costs.

SP’s : Of the 74 firm sales plus 41 options with 11 customers in 2012, how many of these are to leasing companies?

Bagnato: About 15 to 20 per cent of the orders are from leasing companies and the rest are for direct sales.

SP’s: With a production backlog of over 221 aircraft, how would you be able to cater to a start-up airline that needs the ATR 72-600 to commence operations immediately?

Bagnato: We have three years of production ahead. This said, we keep some production and delivery rate flexibility and we strongly cooperate with leasing firms to offer optimal solutions to airlines for a better match of all their needs and expectations.

SP’s: What was the rate of production in 2012 and what is it expected to be in 2013?

Bagnato: 2012 was the best year in the history of ATR with 64 deliveries. This means 20 per cent more deliveries than in 2011 with 54 aircraft. In 2013, we plan to deliver over 80 aircraft and increase our rate of production up to 90 aircraft next year.

SP’s: How well do you think the ATR aircraft fit into the Indian market?

Bagnato: As proven over the years, ATRs perfectly match the needs of regional operations in India. With low operational costs, maximum passenger comfort and low break-even load factors, this aircraft is best suited for regional operations across India.

SP’s: Typically, what is the break-even load factor for the ATR 72-600?

Bagnato: Typically, the break-even load factor for an ATR 72-600 is below 50 per cent. This equals to 35 passengers, which is six to ten less passengers when compared to other 70-seat turboprops.

SP’s: What about the 90-seat next generation turboprop?

Bagnato: ATR is strongly considering a 90-seat turboprop variant and we have presented a business plan to our shareholders EADS and Alenia Aermacchi. This would be a totally new aircraft, further developing the key advantages of the ATR aircraft family i.e. economics, comfort, simplicity and high operational performance.

SP’s: There is confusion as to which aircraft is better suited for India—the performance and route flexibility offered by your direct competitor and the operating economics of ATR 72-600? What are your views?

Bagnato: In India, with jet fuel prices today among the highest in the world and ATR turboprops burning around 30 per cent less fuel than that of a direct turboprop competitor, the economics of ATRs are pressing on shorter sectors typical in India’s regional airline route networks today. It is important to notice that the average length of a typical regional route in India is around 250 nautical miles.

On the routes below 400 nm, the maximum payload of an ATR 72-600 and the competitor’s 70-seat turboprops are very similar and do not bring any significant operating advantage to an airline (no supplementary turn around cycle for an airline due to saved time). In terms of flexibility, the ATR aircraft can deserve a lot more destinations in India and the region. Due to their ability to operate in environments with a wide range of short unpaved airstrips, many of the airstrips are not able to accommodate the large jets of competitor airliners. By the way, the shortest scheduled air route in the world flown by an ATR is just 18 km. There are quite a few regional routes in India that are not much longer than this distance where only an ATR can take off and land.

To sum up, there are not real advantages in India for our competitor aircraft, both in terms of speed or payload. The advantages of the ATR are proved by its long-standing presence in India and the fact that we have traditionally been the preferred solution for regional operations by most of the Indian carriers.