Flybe places £580m jets order

BUDGET airline Flybe is to replace its ageing fleet of BAE-146 aircraft with 14 new aircraft from the Brazilian aerospace group Embraer. The total value of the orders for the Embraer 195 aircraft is estimated at $950m (£580m) if the airline takes up options on a further 12 additional planes.

Flybe's managing director Jim French said the 118-seat aircraft were the right size for the airline's regional operations because possible alternative models from Airbus and Boeing were too large, mostly with more than 150 seats.

He added: 'The Embraer 195 allows us to deliver our famous low fares to all the regions we serve, and allows us to do it profitably, while at the same time increasing the number of regions we can serve with direct European services.'

Flybe bought 20 aircraft from Bombardier in January and now flies on 99 routes across Europe although more than three-quarters of its routes are domestic ones within the UK. The airline, which is based in Exeter, turned in a £14m profit last year in addition to a 24% overall growth in passenger traffic and a 34% overall increase in passenger revenue. It is aiming for a possible float on the stock market within 18 months.

Flybe is the first customer for the Embraer 195 aircraft, which French said had enabled it to strike a particularly good deal. The first aircraft to be delivered under the contract will be handed over in August next year.

Embraer is a niche manufacturer in a market dominated by Boeing and Airbus but is developing a new family of aircraft and hopes to win a significant share of the still untapped market for aircraft in the 70-110 seat range. BAE Systems, formerly known as British Aerospace, no longer makes the BAE 146 aircraft, which has proved a popular model in this segment of the airline industry.