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Fly in, fly out charter operator Alliance has announced it’s agreed on a $111 million deal to purchase 14 114-seater Embraer E190s.
The business said the aircraft will predominantly fly regional routes and hinted its moderate size made it perfect for a post-COVID-19 market.
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“Alliance, since inception in 2002, has a track record of purchasing aircraft at opportunistic times and at significantly reduced value to their market value,” said managing director Scott McMillan.
In May, the airline surprisingly announced it had increased profits this financial year by $7 million, which it credited to its ability to adapt planes for coronavirus.
The deal with US-based Azorra Aviation will see the first of the 14 E190s arrive from September and also includes six spare General Electric CF34 engines, as well as the option to acquire a further five of the Embraer jets.
It will join its existing fleet of 24 Fokker F100, 13 Fokker 70LRs and five Fokker 50 turboprops.
“With many airlines not flying and the increased demand for a 100-seat narrow body configured aircraft in the Australian market, this acquisition is more than opportunistic, it underpins our expected growth,” said McMillan.
“Given the reduced passengers on mainline routes due to COVID-19, the E190 has the potential to be the perfect aircraft type for some mainline routes.
“Our purchase of 21 aircraft from Austrian Airlines in 2015 resulted in significant growth opportunities as well as providing a long-term supply of spare parts at minimal cost for our ongoing operations. Alliance is confident that this purchase of 14 Embraer E190 aircraft will result in similar opportunities presenting themselves.”
The confident move follows Alliance’s huge success in riding through the coronavirus crisis, where it capitalised on the reduced schedule of larger carriers and the need for COVID-adapted planes.
Alliance has said its “pioneering” measures, including social distancing seating plans, new cleaning regimes and passenger temperature checks, have been adopted by much of Australia’s industry.
Previously, it predicted it would post $40 million in profit before tax for the last financial year, up significantly.
Its board called the result “exceptional” and said it would award most of its 500 employees, other than senior management, $1,000 in free shares.
“The swift and flexible response has seen Alliance capitalise on additional demand for flights in the resource sector and, particularly, increases in flight schedules of contracted clients,” Alliance said in a statement to the ASX in May.
Lee
says:Cheaper than A22o-100s I guess!
Grant Haworth
says:Great aircraft, are you retiring any of your older planes.
MERVYN CROWE
says:Good purchase indeed, which will mean they can retire some of their high time `1989 built F100s.
Keith Annetts
says:Exciting Times
AlanH
says:Rex, take note! This is how you do business in the regional space!
Ian
says:looks like Alliance will be doing many more of ex VA regional routes & even perhaps into CBR. Qantas BNE/CBR is most often a B717.
cj
says:looks like Alliance will be doing many more of ex VA regional routes & even perhaps into CBR & not retiring many Fokker jets just yet.
MH
says:Just when you thought the resource sector is going downturn. Are they betting on a recovery of the resource sector soon?
Ronald Spencer
says:where are these planes coming from New ,Second Hand ?
Lhano Martins Xavier Junior
says:These planes are Copa Airlines, and good bye old Fokker 100 who have much cycles!!!