ERA 2006: Airlinair taking full advantage of its turboprop's cost benefits

 - September 13, 2006, 5:14 AM

Airlinair is one of those rare regional airlines that have thrived while maintaining a true regional identity, serving mainly French domestic routes and operating among secondary cities. The company, which operates only ATR turboprops, has gone from success to success, increasing its revenue every year since pilot Lionel Guérin founded it in 1999. It prides itself on its mission to ensure, develop and promote service between Paris and small French cities and on niche routes that bypass the French capital. With the rising price of oil giving turboprops a competitive edge, Guérin sees a rosy future.

In 1990 Guérin, an Airbus A320 pilot and maintenance specialist, established Alto, a maintenance facility now owned by Airlinair. Nine years later he opened the airline, taking over the PTO contracts for several routes up for renewal. Guérin holds 80.5 percent of the company’s shares since Air France subsidiary Brit Air in June last year took 19.5 percent of the equity in what he calls a “natural move of an industrial partnership.” Airlinair currently employs 450 people, including 190
pilots and 50 maintenance technicians.

Airlinair oversees the largest ATR fleet in Europe, flying seven ATR 42-300s and 11 ATR 42-500s configured to carry passengers, two ATR 72-200 passenger airplanes and three freighter versions, and a single passenger-carrying ATR 72-210. The fleet averages 12.8 years of age. It plans to add another ATR 72, now flown by Air Tahiti, in December. Guérin, who in July won re-election to a second three-year term as president of the French commercial aviation association, told AIN that more ATR 72-500s could join the fleet next year. “The high price of fuel makes turboprop operation very attractive,” he said. “We will make a decision by the end of this year.”

Although Guérin showed no inclination to move into other fleet types, the company continues to evaluate Bombardier turboprops as well as ATRs for future needs. Whatever the decision, it seems clear Airlinair will stay with a single type, preferably ATRs. “We are not a low-cost airline but adopt the same economic and single-type aircraft concept,” he said. “This is the basis of our success.” According to Guérin, ATRs work better on short- and medium-haul flights, something he calls “Airlinair’s stock-in-trade,” while the speed of the Bombardiers makes them better for longer routes. Either way, he said, “turboprops just cannot be beaten in our type of business.”

A participant in the Air France/KLM Flying Blue World loyalty program, Airlinair uses Air France’s ticketing system. Under wet-lease arrangements it flies for Air France and its Brit Air and Régional subsidiaries, for Europe Airpost, CCM Airlines and Tassili of Algeria. During its March 2005 to March 2006 fiscal year it reported revenues of ?83 million ($106 million) and net profits of ?600,000 ($760,000). Guérin expects those figures to rise to ?86 million ($110 million) and ?1 million ($1.28 million), respectively, this fiscal year. Regular charter operations for airlines in the Air France group generate about 40 percent of revenue.

Somewhat unusual in that it doesn’t really center on a main hub, Airlinair’s network covers all four corners of France, much of its coast and a handful of cities in the interior. From its base at Paris-Orly it flies under its own colors and the Air France code, to eight cities in all. A second hub at Lyon Saint-Exupéry Airport serves an all-Air France network ranging from Rouen in the north to Montpellier on the Mediterranean coast. Another “mini-hub” at Paris Roissy takes it to Southampton, England, and Eindhoven in the Netherlands as well as to the western French city of Rennes and five other French communities for the postal service.

This year Airlinair expects to carry 800,000 passengers, including 150,000 on its own flight code. Last year it transported more than 600,000 passengers, 130,000 of them under its own colors, up from 75,000 in 2002. It operates more than 100 flights each weekday, claiming 99-percent flight regularity and 97.5-percent punctuality within 15 minutes of scheduled takeoff time. Guérin anticipates more work for Air France starting next spring if the flag carrier withdraws jets in favor of more economic turboprops.