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Today's Headlines
Skywest Plans To Acquire 22 Regional Jets; in Negotiations with Bombardier
 
 
October 15, 2007 -- Bombardier Inc. confirmed yesterday it is negotiating the sale of 22 regional jets worth $660 million at list prices to prominent U.S. commuter airline SkyWest.

SkyWest operates an all-Bombardier regional jet fleet and was a launch customer for the 50-passenger CRJ200. Bombardier has delivered a total of 184 50-passenger CRJ200s and 70-seater CRJ700s to SkyWest, which serves 236 cities in the U.S., Canada, Mexico and the Caribbean.

Family-controlled SkyWest said it is also talking to Brazil's Embraer as it flies small Embraer turboprops. But analysts said Bombardier could well win the order because the Utah-based carrier has always said it is more economical to stay with one aircraft-maker, mostly because of lower maintenance costs.

SkyWest, which flies short and medium-haul routes for United Airlines, Delta Airlines and Midwest Air, said it wants to buy or lease 22 new regional jets to expand and upgrade its services and cut fuel and maintenance costs.

Deliveries would start in late 2008. It would retire 23 Embraer 30-passenger turboprops and replace them with 18 new 66-passenger regional jets, and swap four older 50-passenger CRJ200s for four new 76-passenger jets to be flown by Delta Connection. Under a new union pact, Delta Connection commuter lines can pay their regional jet pilots less than those flying larger aircraft as long as the smaller craft's capacity does not exceed 76 passengers.

The big U.S. carriers, still under post-9/11 financial stress, are focusing on more profitable international routes and turning more to their commuter airline partners to handle regional flights, SkyWest said. "We're bringing more seats to the market just as United and Delta wanted us to do,” SkyWest said. The new United Express regional jets will offer economy and first-class seats, while the older ones are single-class.

Bombardier can meet the demand for all 22 regional jets with its CRJ700/705 aircraft built at Mirabel, analysts said. The firm has delivered 270 of these aircraft and has about 22 on order. It has delivered 111 of the larger CRJ900s with up to 86 seats, and has an order backlog of 108. Bombardier has 38 orders for the new CRJ1000, with up to 100 seats.

The Mirabel plant will build 56 regional jets in 2008, up from 50 this year, and the SkyWest order could lead to a further upward revision, the analysts said. Embraer will compete with its 70-passenger ERJ170, of which 137 have been delivered. Bombardier claims its aircraft are more efficient and are competitively priced. The CRJ700/705 series lists at $30 million each.

Source: Montreal Gazette

 

 
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