MercoPress. South Atlantic News Agency

Brazil's Embraer studying to launch a turboprop aircraft to compete with Franco-Italian ATR

The aircraft would be in the same size range or even larger than the 70-seat ATR-72 Franco-Italian aircraft, Embraer Commercial Aviation CEO John Slattery said

Brazilian planemaker Embraer is in the advanced stages of studying the launch of a new turboprop aircraft to be developed through a venture it is planning with Boeing, subject to necessary approvals, a top executive said on Monday.

 The aircraft would be in the same size range or even larger than the 70-seat ATR-72, a Franco-Italian aircraft that currently dominates the market, Embraer Commercial Aviation Chief Executive John Slattery said.

“It sits in our target market, which we have always been clear is below 150 seats, and will have natural adjacency to the E2 offering,” he said, referring to Embraer's family of 80-120-seat regional jets. “The business case is going well.”

Analysts say such a move could shake up a market dominated by ATR, which controls four-fifths of global sales in competition with the Q400 turboprop, sold by Bombardier last year to Longview Aviation of Canada and renamed the De Havilland Canada DHC-8.

China is also targeting the market with its Xian MA700. Analysts say turboprops are more efficient than jetliners over short distances, especially when oil prices are high.

Speaking as the aviation industry poured into Dublin for annual Airline Economics and Airfinance Journal conferences, Slattery said he believed a move by Embraer into turboprops would force a response from ATR and boost choice for airlines.

He said ATR had a “de facto monopoly” because of recent marketing challenges facing its smaller Canadian rival.

ATR claims to be the world's most profitable aircraft manufacturer with double-digit margins, though it does not publish financial data separately from its co-shareholders, Europe's Airbus and Italy's Leonardo.

It predicts demand for 2,390 deliveries of turboprop passenger aircraft with 61-80 seats over 20 year to 2037.

Embraer is also in “meaningful” discussions with engine makers General Electric, Rolls-Royce and Pratt & Whitney Canada about an engine for the new plane, Slattery said. Pratt is currently the sole turboprop supplier.

Embraer is studying the plan as it tries to complete a 2018 agreement to fold its commercial aircraft activities into a venture to be controlled by Boeing. The deal has won approval from several regulators but the European Union has launched a detailed competition review.