Singapore Air Show

ATR Books Berjaya Buy, Converts Silver Airways Order

 - January 22, 2018, 6:13 AM
Silver Air will begin taking delivery 16 ATR 42-600s starting next month. (Photo: ATR)

Berjaya Hotels & Resorts is buying two preowned ATR 42-500s to bring hotel customers to the resort's location at Redang Island in Malaysia. The first ATR 42 will be delivered in April and enter service in June. The second ATR will enter service shortly thereafter.

Berjaya will reconfigure the two ATRs to carry 36 passengers, with nine rows of four seats and generous seat pitch. The company's CEO, Hanley Chew, said that buying the airplanes fits with the company's strategy of promoting destination travel. The flight from Subang Airport in Kuala Lumpur to Redang takes just an hour, far less time than the current travel method, which involves a one-hour flight to an outlying airport, a one-hour drive to the ferry, which takes another half hour to get to Redang.

"It's almost half a day of traveling," he said. "During the monsoon season, I assure you it's no fun. We needed a more efficient way to bring our guests to their destination. The aircraft is a conduit to the hotel."

Berjaya Air, as the flight operation is named, plans eventually to add service to Singapore.

ATR also announced that it has converted to a firm order last year's letter of intent covering 15 aircraft from lessor NAC for operation with Florida-based Silver Airways. The company plans to deliver the first aircraft from what is its first 2018 order—an ATR 42-600—to Silver in March.

In total Silver Airways will take 20 ATR -600s, 16 being 46-seat ATR 42-600s and four 70-seat ATR 72-600s. Five aircraft will come from NAC’s existing backlog with the manufacturer. Twelve ATR 42-600s and three ATR 72-600s comprise the 15 aircraft added by the new order, but ATR CEO Christian Scherer said the airline could alter the mix later depending on demand. ATR expects to complete deliveries by early 2020, as Silver replaces its existing fleet of 21 Saab 340Bs.

Scherer said the order represents "ATR’s comeback to the United States.”

Meanwhile, Scherer announced final ATR order and delivery numbers for 2017, declaring it “an excellent year” with 113 aircraft sold, compared with just 36 in 2016. It delivered 80 aircraft to customers (78 new and two used), resulting in a book-to-bill ratio of 1.45. Scherer relayed that ATR’s two shareholders, Airbus and Leonardo, were happy to maintain such a stable level of output, although scope exists to increase production if necessary. The backlog now represents three years of production and the company’s revenues total currently around $1.8 billion, he said.

Reflecting on 2017, Scherer said the “coup” of the year was undoubtedly the FedEx contract to develop and deliver a new freighter variant of the -600, which he said had led to an explosion of inquiries from the industry that could stimulate further demand for the 600F as it undergoes development over the next couple of years.

Commenting on route development, the ATR CEO, who joined the company a year ago, expressed satisfaction with the breadth of ATR's presence in the world. “We’ve counted 155 new routes being created by ATR aircraft over the past year…all over the place,” he said.

Referring to India as “the big bang right now,” in particular given Indigo’s recent order for 50 ATRs, Scherer said that China represents an even larger potential market for regional aircraft. Although the ATR -600 has not yet gained certification in China, Scherer noted the bilateral agreement between Europe’s EASA and China’s CAAC drew a “roadmap towards mutual recognition of aircraft certification.”

“CAAC has accepted our application now for certification," he reported. "I’d say it’s a matter of months now, and once done, we’ll firm up our declarations of interest [with Chinese operators].”

In reference to Iran, he said ATR last year delivered eight of 20 aircraft ordered and plans call for the remainder to go in 2018, as the company takes advantage of the “window of opportunity” that might soon close if the U.S. changes its position on the Joint Comprehensive Plan of Action, or so-called Iran nuclear deal.

Finally, Scherer said the airfamer continues to discuss a new ATR 42 STOL variant with customers and “expects to make a decision on this later this year.”