Market Report a Publication of Saab Aircraft Leasing
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Issue 24 May 2010 MARKET REPORT A PUBLICATION OF SAAB AIRCRAFT LEASING CALSPAN MODIFIES SAAB 340A FOR US NAVAL TEST PILOT SCHOOL ARGENTINA’s SOL LÍNEAS AÉreAS ADDS TWO MORE SAAB 340As REX ACCEPTS ATW’S reGIONAL AIRLINE OF THE YEAR 2010 messAGE FROM CONTENTS Michael Magnusson Rex accepts Air Transport World’s Regional Airline of the Year 2010 ............................................3 I know I sound old when I say it’s scary how Calspan modifies Saab 340A for US Naval Test Pilot School ...4 time is passing by and we are already into Darwin Airline adds fifth Saab 2000 the second decade of the new century. The to expand Italian market ........................................................7 year 2000 does not sound that long ago. Of course my growing kids will remind me how Avion Express expands with Bridges Worldwide service .......10 old I am when they react with horror when I talk about the 1970s or even 1980s. Eznis Airways grows its Mongolian route network to China and Russia .......................................11 But there is something to be said for living through the decades, we have experience. Saab Profile: So as the media got a bit hysterical recently Mr. Tserenpuntsag Boldbaatar, Eznis Chairman ....................13 in Europe over the ash-cloud — saying that this will create long-term effects on airline Saab Destination: travel — we know airline travel always Mundo Maya International Airport .........................................14 recovers as it did after September 11, SARS, DOT LT flies Saab 340As for contract in Norway ...................15 swine-flu and other events. Thinking back, I am reminded that we are well into the second decade of Saab Aircraft Thailand’s Nok Mini uses Saab 340Bs Leasing (SAL). We set up our leasing unit within Saab late in 1997, and 1998 became our to expand network and rebrand ............................................16 first full year as a true leasing company with a portfolio of over 300 aircraft. We can now Direct Aero Services expands Saab 340A fleet in Romania ...16 look back at 12 years of leasing activities. Thus I decided to dig into my files and sum- marize what we have accomplished over the tumultuous years in aviation, the outcome NASCAR teams dedicate Saab 2000 airlift for Haiti...............17 is quite impressive. Sol Líneas Aéreas adds fifth and sixth Saab 340As ...............17 Since 1998 we have concluded over 330 aircraft transactions with 75 customers in 30 countries. These can be broken down into 70 Saab 340As, 170 Saab 340Bs, 80 Saab Pegasus Air flies corporate Saab 340 ...................................18 2000s and 10 other aircraft types. Of these we have sold 80 aircraft and completed 250 lease transactions. During this timeframe, our largest customer has clearly become Rex SAL posts first quarter 2010 transactions in Australia with 45 aircraft transactions since 1998. But we also have done double-digit and double-digit 2009 deals .................................................19 transactions with many other large clients such as American Eagle, Colgan and PenAir in the US; Aerolitoral in Mexico; and Crossair, Eastern, Golden, Loganair and OLT in Europe. Rex launches online forum for Saab operators ......................19 Of these, Crossair is no longer with us, at least in its original form. Even though Aeroli- Mark your calendar .............................................................................. 19 toral and American Eagle have moved on to larger aircraft it’s rewarding to note that the rest of you are still successfully flying Saab equipment. The prize for our longest time Saab operators map ........................................................................... 20 leasing customer goes to PenAir which began in 1997. Loganair and OLT are not far behind. After that there is Golden and Colgan, so it’s pleasing for me to see that most of our large customers have stayed with us well over a decade. It is also gratifying to see how many of our Saab 2000 customers began with Saab 340s. I am thinking of Air Botnia/Blue1, Carpatair, Golden, Lithuanian and OLT. As I write this column others are thinking about it, and I think this shows how an operator can grow with Saab aircraft. Cover photo: Paul Schifferle, Calspan’s Flight Research Techni- Another aspect to this is how the market has evolved, from independent regionals, to cal Manager, flew in the back of a Learjet chase plane to capture code-share, to fully-owned, and to “fee per departure”. Meanwhile, low-fare airlines this image of the first flight of the have made huge in-roads in North America and Europe. Who would have thought only a modified Saab 340 few years ago that Ryanair would fly more passengers than British Airways? Demand for Saabs have all the while constantly shifted between different parts of the world, but the demand is still there. Market Report is published by Saab Aircraft Leasing So going forward, we will continue to offer our extensive leasing experience to you as a customer. Times are always changing, but airlines still need cost-effective tools in order Editor: Kelly Murphy Emerald Media to make money. Many larger legacy airlines are cutting back on regional services which [email protected] will open up new opportunities for regionals. Our venerable Saab turboprops meet all the latest regulatory standards, and there are no noise or emission threats on the hori- Europe: Alison Chambers Emerald Media zon that may impact us. Fuel efficiencies are more important than ever as we speculate [email protected] when oil will pass $90/barrel again. I and everyone within Saab Aircraft Leasing look forward to this “second decade” of leasing activities. And I promise to stop talking about Design and Layout: Aeris Graphic Design the 1970s and 1980s. [email protected] Printed in USA May 2010 ©2010 Saab Aircraft Michael Magnusson President and CEO, Saab Aircraft Leasing MARKET REPORT REX ACCEPTS AIR TRANSPORT WORLD’S reGIONAL AIRLINE OF THE YEAR 2010 REGIONAL EXPRESS EXECUTIVES CELEBRATED THE COVETED REGIONAL AIRLINE OF THE YEAR AWARD FOR 2010 DURING THE GALA DINNER AND AWARDS CELEBRATION IN SINGAPORE ON FEBRUAry 1 During Air Transport World’s gala its rock-solid balance sheet with “Rex’s ability to grow and prosper dinner and awards celebration on no long-term debt.” while winning strong customer February 1 in Singapore, Regional accolades makes it a highly Express (Rex) executives proudly The editors further commended deserving recipient of the 2010 received the coveted Regional Rex for its highly unusual, but Regional Airline of the Year Airline of the Year award for 2010. successful, business strategy, “Rex award.” is the sole operator on most of its Rex facts: The award is in recognition of routes and caters to a base of non- Rex Executive Chairman Lim Australia’s largest Rex’s superior safety record and discretionary business travelers, Kim Hai notes Australia can be independent regional operational excellence that have so it could have pursued a strategy proud of laying claim to a regional airline operating a fleet been demonstrated by outstand- of raising fares and reducing ca- carrier that is second to none in ing punctuality and flight comple- pacity. Instead, in what it calls the the world. “In the 36-year history of 46 Saab 340 aircraft tion. The airline was also praised Rex Virtuous Cycle, it becomes of the awards, this is only the on some 1,300 weekly for its outstanding customer its own competitor by increasing second time that an Australian flights to 35 destinations service as evidenced by the con- frequency on a route whenever regional airline has received this throughout New sistent top rankings in consumer the load factor exceeds 70 percent. honor which had previously been South Wales, Victoria, polls over the years. This causes load factors to fall monopolized predominantly by Tasmania, South Australia with a corresponding decline the large American carriers. I am On Rex’s financial performance, and Queensland. The in average fares that stimulates proud to say that the award win- the ATW editors highlighted, Rex Group comprises further demand, beginning the ner in 1991 was none other than “The strength of the company’s Regional Express, air cycle again.” Kendell airlines, one of the two business model is demonstrated freight and charter constituent airlines of Rex.” by the fact that in the fiscal operator Pel-Air Aviation “The Rex Virtuous Cycle has led year ended June 2009, a period and Dubbo-based to better service and lower fares “The award is also recognition encompassing the global financial for consumers, while shareholders of the hard work and dedication regional airline Air Link, as crisis, earnings dipped less than have enjoyed six consecutive years of the staff at Rex who have lived well as, the pilot academy 6 percent compared to the prior of profit,” said ATW Editorial up to our company motto, ‘Our Australian Airline Pilot year, and Rex remained profitable Director Perry Flint during the Heart is in the Country’, and Academy. in the first quarter of the 2009/10 award ceremony. helped create this world class financial year. The carrier’s strong regional airline.” profit performance is matched by MARKET REPORT | May 2010 3 CALSPAN MODIFIES SAAB 340A FOR US NAVAL TesT PILOT scHOOL BY Kelly MURPHY PHOTOS BY PAUL SCHIFFERLE 4 MARKET REPORT | May 2010 MARKET REPORT “…the Saab 340 was selected based on its operating costs, available electrical power and cabin size. It has the right flight envelope for the mission.” — Calspan President and CEO Lou Knotts Louis H. Knotts President and CEO “It’s been great working with Saab again,” Knotts shares with SMR. Having worked as a project pilot on the Gripen when Calspan handled the flight control A Saab 340A (msn 340-102), swapping out the nose of the Knotts explains Calspan has a work for the Saab fighter jet in modified by Buffalo, New York- 30-seater with that of an F-16 long, working relationship with 1980, Knotts has fond memories based Calspan with specialized fighter jet.