MercoPress. South Atlantic News Agency

US Airways o buy jets from Canada, Brazil.

US Airways has struck a $4.3bn deal to buy at least 170 regional jets from Bombardier of Canada and Embraer of Brazil just weeks after emerging from bankruptcy.

The order, which includes an option for a further 380 aircraft, splits equally between the world's two leading regional jetmakers and will provide a significant boost for the struggling companies.

David Siegel, chief executive, wants to expand US Airways' regional network in the group's post-Chapter 11 efforts to seek more viable avenues for profit.

"Regional jets will allow us to replace and complement larger jet aircraft on routes with poor to marginal performance, which can then be redeployed to operate in more profitable destinations," he said.

Prior to bankruptcy, the US's seventh largest carrier had relied on regional hubs for revenue but was limited by agreements with its pilots and could fly only 84 regional jets with many routes using older turboprop aircraft. The terms of its reorganisation plan mean US Airways, or its affiliates, can operate as many as 465 regional jets.

Delta and Continental have both long offered regional jet services at the same hubs as US Airways. "We were losing business because we were flying 37-seat propeller planes," said US Airways.

US Airways placed orders for 85 jets from Bombardier, which include 60 CRJ Series 200, 50-seat aircraft, and 25 CRJ Series 700, 75-seat dual-class aircraft, for delivery in October. From Embraer, the carrier ordered 85 Embraer 170 70-seaters with delivery scheduled for November 2003.

US Airways had said previously that it planned to order 50 50-seat regional jets and 50 70-seat regional jets from either Bombardier or Embraer.

The orders will be a boon to both companies. Bombardier last month reported a loss of C$615.2m (US$443m) for fiscal 2002, while Embraer reported net profits last year of US$222.6m, down from US$328.4m in 2001. Bombardier shares were up 14 cents to C$4.30 by the close, while Embraer was up 5.05 per cent at US$14.97 in New York.

Embraer, the world's fourth biggest manufacturer of civilian aircraft, has cut its forecast for jet deliveries in 2003 twice since the start of the year due to an order cancellation from Swiss International Air Lines in March and an order delay by top client ExpressJet Holdings in February.

Under its reorganisation plan, US Airways reached an agreement for GE Capital to provide up to US$350m of leveraged lease equity for regional aircraft, which translates into approximately US$1.7bn of equity financing for this deal. Analysts thought it likely that the jet makers could finance the remainder, or local banks in Brazil or Canada.