Eurowings: ERA Regional Airline of the Year

 - October 4, 2007, 9:12 AM

ERA named German operator Eurowings regional airline of the year at last month’s general assembly, 12 months after the German regional airline placed second in the competition. Eurowings attributes its success to its fleet mix and route network; an appropriate alliance policy with German flag carrier Lufthansa, which has an option to increase its 25-percent stake in the regional to 49 percent; and an attractive “customer product.”

The airline flies some 330 services a day to nearly 60 destinations in almost 20 countries. It carried 3.2 million passengers last year. It has seen profits more than double in two years, from e2.6 million in 1998 to e5.8 million last year, according to senior vice president Karl-Friedrich Mueller.

Eurowings flies a fleet of 49 aircraft, comprising five Airbus A319s, 10 BAE 146s, seven Bombardier CRJ-200s, 10 ATR 72s and 17 ATR 42s, with one A319, six ATR 72 and eight CRJ-200 deliveries outstanding. The A319s are used for charter by a separate operational unit, while new ATR 72s will replace earlier ATR 42s.

Delivery of two more CRJs late last month “sends a message to all operators about the value of an alliance with a major. We are still on track to take more aircraft next year,” according to Mueller. He said that while the airline recession could continue for at least six months, it would benefit regionals “since majors still need feed.” Eurowings is talking with Lufthansa about opportunities to “keep the market alive” on routes from which the flag carrier might withdraw Boeing 737s or larger Airbus equipment.

The Dortmund-based regional has been adding Canadair Regional Jets to its fleet, mainly on new routes or in place of services previously flown by Lufthansa. Mueller said turboprops are used on routes of up to 1.5 hr, “which make no sense for an RJ.” Jets are used on services of two or more hours, or where there is rail or other direct point-to-point competition.

Conceding that RJ operating costs run 10 to 15 percent higher than those of a turboprop, Eurowings executive board member Ulrich Sigmann said that 2.5 hr is too long a journey to sell successfully with anything other than a jet. As Eurowings prepares to decide in the next several months on equipment to replace its BAE 146s, Sigmann laments the absence of a single RJ family offering complementary capacities from 50 to 110 seats. He said the new BAE Avro RJX is “still based on the old BAE 146,” although he acknowledged the value of continuity.

The main problem lies with the availability of a 70- to 90-seater that can be stretched to 110 seats and shrunk to 50 seats economically, he added. “We need 70 to 90 seats for point-to-point routes and 98 seats on some feeder services,” said Sigmann. “But no 90- to 110-seater will be available to enter service in 2003 or 2004.”

While Eurowings is not considering the Bombardier CRJ-700, he said that if the airline opts for the Avro RJX “we must consider what [Lufthansa partner] CityLine does within the total Lufthansa concept.” This makes Fairchild Dornier products a consideration for Eurowings, since CityLine has placed orders for 60 Fairchild Dornier 728JETs. Ultimately, Eurowings would like to adopt a two-aircraft fleet, which would not necessarily include both props and jets. “In ten years’ time, perhaps we will have no turboprops,” concluded Sigmann.