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Euro rival's plane better than Bombardier's Q400 on short haul, expert says

A leading aviation analyst has declared a European-built turboprop to be superior on short-haul flights over its Canadian rival, resulting in a surprising vote of confidence for the foreign aircraft maker's bid for a 40-plane contract with WestJet Airlines Ltd.

The French-Italian ATR 72-600 is the ideal fit for WestJet because it's more fuel efficient than Bombardier Inc. 's Q400, said Ben Cherniavsky, a Vancouver-based analyst with Raymond James Ltd.

"According to our detailed calculations, the ATR fleet delivers superior returns," he said in a research report Thursday.

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The ATR 72-600 – with a list price at $23-million (U.S.), compared with the Q400 at $30-million – stands out on shorter routes that WestJet will be considering for its new regional subsidiary, Mr. Cherniavsky said. "Our analysis reveals that there are relatively few markets in Canada where the speed of the Q400 makes a material enough difference to offset its higher costs."

WestJet's final decision will come down to which routes to focus on and, if it places the highest priority on scheduling flights that take less than an hour, the ATR 72-600 has an edge, he said.

The Q400, assembled at Bombardier's Downsview plant in Toronto, has a maximum cruising speed of 667 kilometres an hour, compared with the ATR 72-600's top speed of 510 km an hour.

ATR spokesman David Vargas said in a statement from France that he's confident that WestJet will "certainly select the aircraft best suited for the mission and the financial return," and the European turboprop is the logical choice for an airline seeking "significantly better results."

European aerospace giant EADS co-owns ATR with Italy's Alenia Aermacchi. "ATR 72s feature a clear advantage to airlines. Cash operating costs per trip of a Q400 are more than 20 per cent higher than the costs of the ATR. When comparing a fleet of 40 aircraft during one year on a typical 300 nautical mile route, the use of ATRs instead of Q400s may represent savings of some $30-million," Mr. Vargas said.

But Philippe Poutissou, vice-president of marketing at Montreal-based Bombardier's aerospace division, said the Q400 is the right turboprop for Calgary-based WestJet because the plane is more powerful and has a longer range, as well as the capability to reduce speed when necessary to conserve on fuel.

"The Q400 is an aircraft that delivers flexibility. So if you need it to be a slower and extremely efficient aircraft, you can fly it that way," Mr. Poutissou said. "When you look at an investment in an aircraft, you need to look at it over many years."

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Mr. Cherniavsky noted that while he prefers the smaller-sized ATR 72-600, "both scenarios generate a positive outcome for WestJet as a whole."

One major strike against the foreign plane, however, is its "inferior climbing performance and single-engine cruising capabilities – the altitude at which the plane can fly in case of an engine failure," he said.

WestJet plans to launch its low-cost regional arm by the end of 2013, hoping to erode Air Canada's strength on the country's regional routes.

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About the Author

Brent Jang is a business reporter in The Globe and Mail’s Vancouver bureau. He joined the Globe in 1995. His former positions include transportation reporter in Toronto, energy correspondent in Calgary and Western columnist for Report on Business. He holds a Bachelor of Commerce degree from the University of Alberta, where he served as Editor-in-Chief of The Gateway student newspaper. Mr. More

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