Dubai
Dubai Aerospace Enterprise (DAE), an aircraft lessor in the Gulf, plans to buy as many as 65 turboprop ATR 72-600s, the company’s chief executive said on Monday, citing increasing demand in the emerging markets and elsewhere.
DAE already owns 35 ATR 72-600s, a short haul regional jet built by an Airbus Group and Finmeccanica co-owned firm, according to a company slide. Those aircraft are leased — or have been committed to be leased — to airlines predominately operating in Latin America and Asia.
“Our objective is to own somewhere between 60 and 100 just of those aircraft,” Firoz Tarapore told Gulf News in an interview at DAEs offices in Dubai. By Gulf News’ calculations, 65 new ATR-600s are worth $1.74 billion (Dh6.4 billion) at list prices.
DAE, who last month reported a $610.4 million profit for 2015, sees turboprop demand growing in Asia, Africa, Australasia, the Caribbean, Latin America and in parts of Europe.
“It’s a fabulous aircraft that serves a very unique requirement,” Tarapore said, telling Gulf News that there was no set timeframe to buy the turboprops.
There is also increasing demand in the Middle East. DAE recently placed two ATR 72-600s with Egyptian-Saudi Arabian airline Nesma and Iran’s national carrier Iran Air signed a deal in February to buy as many as 40 of the turboprops from the manufacturer.
“Iran is an important market for us and we are working to get the right profile and business there,” Tarapore said.
DAE, who also owns and leases out Boeing and Airbus aircraft, bought 20 ATR 72-600s in 2014 in a deal valued at $988 million that included options for a further 20. DAE has not exercised those options and would consider buying more of the turboprops on the open market having bought at least 15 that way already, Tarapore said.
DAE has “backed away at the last minute” from deals to lease out 12 Airbus A320neo’s, the manufacturers new version of the narrow body medium-haul jet, Tarapore said.
DAE does not own any A320neo’s though it is common, shortly before delivery, for airlines to reach a sale and leaseback arrangement with a lessor.
Airlines have complained of cooling issues with the Pratt & Whitney engine that powers the A320neo, while more recently there have been complaints over aircraft software and hydraulic problems.
It “has been very frustrating because it stops us from doing business,” Tarapore said, blaming a lack of visibility on Airbus and Pratt & Whitney’s plans to solve the engine issue.
An alternative engine for the A320neo’s built by General Electric-Safran venture CFM International is scheduled to enter service in July.
