Chief Executive Officer Christian Scherer said he was “very happy with what ATR has achieved”
in 2017. ALL PHOTOS ATR UNLESS STATEDATR
On the Up
ATR IS celebrating a return to form
following what it declared to be an “out-
standing” 2017. The Franco-Italian firm
landed 113 firm orders (plus 40 options)
in the 12 months to December, three
times more than a year earlier when it
secured deals for just 36 aircraft.
Speaking at the company’s annual
press conference in Toulouse, Chief
Executive Officer Christian Scherer said
he was “very happy with what ATR has
achieved”.
A Real Coup
The CEO used the event to reflect
on some of the company highlights
from 2017. This included a return to
the US – via orders from FedEx and
Silver Airways – and the addition of
what he termed “quality” customers
to the ATR portfolio, including IndiGo,
China Airlines (via subsidiary Mandarin
Airlines) and Japan Airlines. The latter,
Scherer noted, exercised outstanding
purchase options before it had taken
delivery of its first example. But it’s
FedEx the chief considers to be the
“real coup”.
He noted: “It’s not usual for cargo
operators to procure new-build aircraft,
largely because it’s difficult to justify the
capital investment.
“But with the ATR 72 Freighter [of which
the carrier has placed a firm order for 30
aircraft] we can offer a large cargo door,
plus the capability to automate and con-
tainerise the freight-loading process. It
justifies the investment for ATR to devel-
op the type, and for FedEx to buy it.”
Scherer said demand in the 7-8 tonne
freighter category is growing, noting the
new variant will “open up a whole new
market space for ATR”.
The US logistics firm’s commitment,
which includes options on a further 20
examples, helped drive the Toulouse-
based manufacturer’s book-to-build
ratio to 1.45 and expands its order back-
log to three years’ production. This, the
CEO remarked, makes ATR “probably
the most profitable aircraft programme
around”. While declining to reveal
company profits for last year, he did
note total turnover had risen to €1.8bn,
consisting of €1.5bn from aircraft sales
and a further €300m from services such
as training and global maintenance
agreements.Finding its Level
Having previously outlined its desire to
stabilise production at 80 airframes,
ATR’s ‘Flight Level 80’ initiative is now
in full swing with the firm delivering 78
new-build aircraft (and two second-
hand examples) last year. This output
is intended to help the manufacturer to
limit the impact of excess capacity
in the second-hand market while also
addressing pressure from lessors,
important customers in their own right
but potential rivals when it comes to
placing new ATRs with operators.
Scherer admitted the firm has the ability
to ramp up production further, but noted
“80 aircraft is about the right level for
the current market, and we plan to main-
tain this for 2018”.Investing for the Future
ATR’s performance last year has given it
a commanding lead in the sub-100 seat
regional aircraft market, but the firm
is not immune from the challenges
affecting the wider industry. Pilot short-
age is a real and growing issue, driven in
part by the lack of training facilities and
retention issues with carriers across
the globe.
Scherer was frank about the challenges
facing the sector. “The training aspect
of our business is performing well, but
we’re suffering from a shortage of
capability in the market.
“The regional market is suffering from
excess demand versus supply of pilots.Airliner World’s Craig West travelled
to Toulouse for the European turboprop
manufacturer’s annual press conference.
It’s not just bodies, but also capability.
The shortfall is predictable, hence our
investment, but we’re also seeing pilots
upgrading from turboprops to jets in
huge numbers so turnover is very high.”
The CEO said the issue is exacerbated
in markets such as India, where demand
is significant, while new ATR operators
such as Mandarin Airlines are working
“around the clock” to train pilots.
To help counter this, the manufacturer
has invested in two new simulators – in
Miami and in Paris – with another due
to come online in Toulouse in July. This
is in addition to supporting third parties,
such as Ansett Aviation Training which
is adding ATR capability in Taiwan in
May, and Japan Air Commuter, which
has its own simulator on order.On the Rise
But despite these difficulties,
turboprops are enjoying a resurgence
in the regional market with a sizeable
increase in capacity. Last year, the
number of available seat-kilometres
(a metric used to measure capacity)
grew by 9% for ATR aircraft alone, and
6% for turboprop aircraft. This com-
pares favourably to the 2.3% increase
for regional jets, and is indicative of a
changing dynamic in the sector with
many airlines opting for more efficient
aircraft types.
“Turboprops are outgrowing jets at a
ratio of three to one, and we’re happy to
be at the forefront of this drive,” the CEO
remarked. Notably, ATRs were directly
responsible for the creation of 155 new20 AIRLINER WORLD APRIL 2018
News Review • International