Story ID: 620 ATR Production.doc
ATR Continues To Drive Turboprop Revolution
By: Ian Sheppard
Caption: Still one of the industry’s turnaround success stories, ATR has gone from strength to strength since almost closing 10 years ago due to ‘jet mania’.
Word Count: 586
Franco-Italian turboprop manufacturer ATR is here at the Dubai Air Show (Stand 816) in a region where it has not sold aircraft in as large numbers as in some other regions, although it has found considerable success in the wider area including North Africa, India and Africa. An exception was the February 2014 order for 40 ATR 72-600s placed by Dubai Aerospace Enterprise (DAE) Leasing.

During a tour of the ATR factory in Toulouse in September, spokesman David Vargas pointed out that the launch customer for the ATR72-600 had been Royal Air Maroc and the launch customer for the ATR 42-600 was Precision Air Services of Tanzania. Since launching the modernized -600 model, ATR has recorded strong sales worldwide, prompting it to establish a second, more modern final assembly line and taking more hangar space freed up by shareholder Airbus at Blagnac Airport in Toulouse. This includes a vast new completion and delivery area; its final assembly and completion hangars now total 32,000 square meters of floor space, four times what it had in 2005.

At the European Regions Airline Association (ERA) general assembly in Berlin last month, ATR CEO Patrick de Castelbajac, said that ATR is on course to produce more than 90 aircraft this year, as planned, but the plant could eventually take production up to 120 aircraft a year. The company has a backlog sufficient for three years’ of production (almost 300 aircraft). Vargas reported that ATR now has 194 operators in 94 countries and that the company was hoping to produce 100 aircraft next year.

Whether there will be a new 90-seater is still undecided; it appears that while the Italian shareholders (Finmeccanica) are all for proceeding now, the French side of the 50:50 joint venture company (Airbus Group) wants to wait “until production is stabilized at 100 aircraft a year,” said Vargas. “They think there is no risk right now [of competition launching one] and there is not an immediate need [yet].”

He was keen to point out that despite oil prices crashing, ATR’s market share has remained the same. “This is very important for us and shows that people have discovered what a turboprop is, and perceptions have changed…and residual values are more than 50 percent of the [original price] after 10 years.” The ATR 72-600 list price is now $25.9 million.

Vargas added that both the ATR variants, the 70-seat ATR 72-600 and 50-seat ATR 42-600, can continue in production, since the ATR 42 is assembled on the same line as the ATR 72. He compared this to Bombardier, whose Q300 production line (separate from the Q400) had to be closed down due to lack of sufficient orders. Thus the ATR 42-600 is now the only 50-seat regional aircraft in production; even lessors are purchasing them. Some 75 ATR 42s were sold last year.

Leasing companies have taken to turboprops, and particularly ATRs, over the past five years or so, starting with AirLease and Nordic Aviation Capital. “And last year we signed DAE for 20 aircraft,” said Vargas. The first DAE aircraft was due to be delivered at the end of last month.

The Middle East and Africa account for 34 operators in 27 countries, with Africa accounting for the first to operate both the ATR 72-600 (Royal Air Maroc in August 2011) and the ATR 42-600 (Precision Air of Tanzania). But “most aircraft go to Southeast Asia and Latin America,” said Vargas.

ATR now employs 1,200 people, up from 600 ten years ago, and around 7,000 are involved in producing the aircraft.