Strong demand for its turboprop regional airliners is prompting to forecast a second record year in a row in 2014 after delivering a best-ever 74 aircraft and signing orders for another 195 in the previous 12 months. “We expect to deliver at least 80 aircraft this year, and our revenues will climb to $1.8 billion from $1.63 billion,” says CEO Filippo Bagnato.
That puts ATR’s backlog at 221 firm aircraft orders, or nearly three years’ production.
With the company on such firm footing, customers are pressuring airlines to push for the next step: a 90-seat ATR. But that’s not likely to happen anytime soon as ATR’s 50-50 ownersand continue to afford it different priorities. The Italian company wants to press ahead, but Airbus has many other more important projects on its plate.
That firm footing is having another effect. “ATR is now big enough to transform into a full company instead of a cooperative arrangement,” says Bagnato, “just as Airbus transformed itself 15 years ago.” A “proper” company would replace cooperation with defined shareholdings; suppliers – often the two shareholders themselves – would provide aerostructures and services on a transparent, commercial basis rather than on “contributions”; and ATR as a company would have more say in its own destiny.
“The two shareholders are working together to change the structure,” says Bagnato. Once done, ATR will be in a better position to launch the 90-seater.
ATR’s own engineers are already working on defining the larger aircraft, and more resources will be needed. But Bagnato sees no hurry. “With no competition in the 90-seat category it is not so important to be first so quickly. But development is not a short-term activity – it will take four or five years,” he says.
Indeed, the lack of a 90-seat turboprop offering by any manufacturer means airlines will have no choice but to continue buying 72-seat aircraft.
Refining the corporate structure is a key point in ATR’s future growth, says Bagnato. He is unhappy that he is portrayed in the press as campaigning for the 90-seater against the wishes of Airbus, locking horns with Airbus CEO Fabrice Brégier. “That is not true at all,” he says. “To clarify, our opinion is that while we have to work around the future development, at the same time it is important to keep solidarity [with our shareholders]. “It is not Bagnato against the rest of the world.”
He notes that, interestingly enough, while the shareholders consider ATR a good investment, so lessors are viewing the aircraft the same way. Some 34% of ATR’s backlog is now booked to leasing companies compared with almost none of it a couple of years ago. “That shows they’re viewing ATRs as more and more of a good investment,” he says.