Aer Arann closes in on aircraft deal

IRISH AIRLINE Aer Arann is believed to be finalising a deal to acquire new turbo-prop aircraft from Toulouse-based manufacturer ATR.

It is understood that this investment is being supported by its major shareholder, UK haulage and logistics company Stobart.

Stobart Ireland executive Seán Brogan, who is acting as the airline’s interim chief executive, told staff recently of its plans.

The airline is expected to opt for ATR 72s, some of which it already has in its fleet.

The deal is expected to be announced at the high-profile Farnborough International Airshow in England in July, which is one of the biggest annual trade shows for the aviation industry.

No comment was available yesterday from Aer Arann or Stobart. The purchase would represent a significant commitment by Stobart in Aer Arann and signals its intention to try and grow the airline’s services.

It is not clear how many new aircraft Aer Arann would purchase but the ATR 72s cost between $16 million and $20 million. In 2007, Aer Arann placed an order for 10 ATR 72-500s in a deal valued at $180 million.

Aer Arann is believed to have also held discussions with Bombardier about an aircraft deal but has decided to stick with ATR. Since exiting examinership in 2010, Aer Arann’s business model is now almost exclusively built around operating as Aer Lingus Regional.

This is a franchise arrangement that involves Aer Arann operating flights on certain routes to Britain with Aer Lingus selling the tickets via its website. Aer Arann receives a franchise fee from Aer Lingus for each flight and this partnership has been expanded over the past two years. The deal was extended in April of this year.

Aer Lingus Regional recently launched flights from Dublin to London-Southend, an airport owned by Stobart.

Turbo-props involve a jet engine attached to a propeller. They perform about one-quarter of all intra-European flights. The ATR 72 seats up to 78 passengers.