Is it right to assume, in the wake of Continental Express' order for 37-seat Embraer RJ-135s to operate alongside its 50-seat ERJ-145s, that the regional turboprop is dead and that, to survive, particularly in North America, all regional airlines must move to jet-power even for their smallest needs?
Or are we seeing, in the "instant" success of the airlines operating regional jets, the results of generous launch deals with manufacturers and lucrative code-share arrangements with major airlines anxious to offload unprofitable short-haul jet flying?
What if both factors are conspiring to make the introduction of the regional jet look extraordinarily successful, and so are in danger of misleading other airlines into believing that regional jets are the key to instant success?
What is certain is that not every regional airline will be fortunate enough to be offered the favourable pricing and financing terms, not to mention the preferential rates on premium routes, which Continental Express is enjoying with its landmark move to an all-jet regional fleet. There are strong reasons to argue that airlines which want to follow Continental's example cannot necessarily expect the same degree of instant success.
For starters, there can only be so many launch deals. Not only that, but not all regional carriers now profitably operating turboprops are in a position to secure agreements with their major airline partners that will give them access to routes on which they can be sure of making money with a more expensive jet. To make matters more difficult, they face the task of making the transition to jets in the face of head-to-head competition from those regionals which do enjoy those benefits and which have already established a strong market position with jets.
So, if success is not assured, therefore, why not stick with turboprops, which regional airlines know they can make money with? The simple answer is: passengers prefer jets. Even a modern turboprop with all the same sophisticated systems as those of a jet is perceived by passengers to be out of date. They even think that jets are safer although there is no significant statistical difference between their inherent safety levels. As a sign of the triumph of jets over turboprops, Continental, for example, has seen its passenger loads increase by 30% on routes where a turboprop was replaced by a new regional jet, the ERJ-145.
There is no doubt that peer pressure to introduce jets will grow as fast as jets are introduced into more regional markets. The pressure is so great that, in the USA - the world's largest and most mature regional airline market - communities are demanding that the airlines serving them introduce jets. Communities, seeing regional jet service introduced into neighbouring cities, fear the loss of business that could result. The only thing that appears to be holding the retreat of the turboprop in check is the manufacturers' inability to produce jet aircraft fast enough.
If the pace of delivery is all that is holding back the onslaught, then what is the long term future for turboprops? The reality is that there is a long term future, if only because turboprops still make up the majority of the regional fleet and will continue to be predominant well into the first decade of the next century. Not only that, but - increasingly - those turboprops which are replaced in mature regional markets will almost certainly enjoy a new lease of life in emerging markets such as Latin America, Eastern Europe, China and India.
So the message to the vast majority of turboprop operators - and those manufacturers still making them - is not to panic. If you are making money with turboprops, there is good reason to be cautious about jumping to jets until you are certain that you can cover the higher costs on your routes. Don't forget the lessons of the goldrush. The first there found their fortunes. Those that followed lost their shirts. Those that stayed and served the community they created went on to prosper in the long term.
For regional airlines, the first to tap the jet vein are most likely to strike gold because the conditions are right, while the fortune seekers that follow will find mining success much tougher. Those regional airlines that are prepared to wait might yet prosper by being patient and by continuing proven profitable turboprop operations while waiting for the economic miracle of the regional jet to be tried and tested.
Source: Flight International
