Bombardier and Chorus Sign Purchase Agreement for up to 23 Q400 NextGen Aircraft and Launch New Extended Service Program for Dash 8-300 Aircraft

Q400 aircraft to be operated by Jazz under the Air Canada Express brand

TORONTO and HALIFAX, Feb. 2, 2015 /CNW/ - Bombardier Commercial Aircraft and Chorus Aviation Inc. ('Chorus') (TSX: CHR.B CHR.A), parent company of Jazz Aviation LP ('Jazz') announced today that they have signed a firm purchase agreement whereby Chorus will acquire 13 Q400 NextGen aircraft and options for 10 Q400 NextGen aircraft. Once delivered, the aircraft will be operated by Jazz under the Air Canada Express banner. The Companies also announced Chorus and Jazz as the launch customer and operator for the industry's first Dash 8-300 aircraft Extended Service Program that will extend the life of the Dash 8-300 turboprop to 120,000 flight cycles from the original 80,000 flight cycles.

Q400 NextGen Aircraft Purchase Agreement

Based on the list price of the Q400 NextGen aircraft, the firm order is valued at approximately $424 million US, and could increase to $758 million US should Chorus exercise all its options.

"The addition of these new Q400 NextGen aircraft will continue Jazz's fleet renewal program that began in 2011, and provide unit operating costs that are amongst the lowest of any regional aircraft," said Joseph Randell, President and Chief Executive Officer, Chorus and Jazz. "The addition of these efficient aircraft is an important component of our cost reduction plans and the amended Capacity Purchase Agreement ('CPA') with Air Canada. The Q400 NextGen airliner has proven to be an outstanding complement to our exclusive fleet of Bombardier turboprops and regional jets."

"We are delighted that Chorus and Jazz continue to put their confidence in the Q400 NextGen turboprop, relying on the aircraft to provide service from coast to coast in Canada and the United States," said Mike Arcamone, President, Bombardier Commercial Aircraft. "With its unbeatable economics, in-service performance and excellent passenger comfort, the Q400 NextGen aircraft is widely regarded as the proven choice for North American carriers looking for large turboprop aircraft and it continues to be a segment in which we've retained 100 per cent market share."

Dash 8-300 Aircraft Extended Service Program

The Extended Service Program will extend the service life of Jazz's Dash 8-300 aircraft by 50 per cent, or approximately 15 years. The agreement covers a minimum of 19 aircraft and the program will begin in early 2017. The Dash 8-300 aircraft is an efficient 50-seat turboprop with attractive operating economics that is well suited to meet regional passenger demand across Canada.

"We are the world's largest operator of Dash 8 aircraft," continued Mr. Randell. "Our collaboration with Bombardier goes back many years and we're very pleased to be the launch customer for this innovative program that will keep this valuable asset in the Jazz fleet. This 50-seat turboprop is well suited to many of the regional markets we serve under the Air Canada Express banner, and it's difficult to beat its economics."

"The Dash 8-300 aircraft has been a top-performing turboprop since its launch over two decades ago and it remains very much in demand today. Our Extended Service Program will enable operators to further take advantage of the Dash 8-300 aircraft's economic and operational value," said Todd Young, Vice President, Customer Services, Bombardier Commercial Aircraft.

The Extended Service Program will be accomplished through several structural and engineering analyses, applying fatigue and test data that has been accumulated on the Dash 8-300 aircraft. It will be initiated through a Service Bulletin that will make reference to a new Maintenance Program Supplement. As launch operator, Jazz will incorporate the Service Bulletin and Maintenance Program Supplement and arrange for the replacement of some structural and systems components as identified by the Service Bulletin.

Quoting Quantos (Thread starter): "We are delighted that Chorus and Jazz continue to put their confidence in the Q400 NextGen turboprop, relying on the aircraft to provide service from coast to coast in Canada and the United States," said Mike Arcamone, President, Bombardier Commercial Aircraft. "With its unbeatable economics, in-service performance and excellent passenger comfort, the Q400 NextGen aircraft is widely regarded as the proven choice for North American carriers looking for large turboprop aircraft and it continues to be a segment in which we've retained 100 per cent market share."

Didn't realize that 7F's fleet of ATR72's doesnt seem to be counted as "a large turboprop aircraft."

Also, define unbeatable economics? The speed advantage over the ATR? Absolutely; fuel burn? Seems that it's common knowledge the Q is more thirsty than the ATR.

In terms of in service performance, isn't the Q somewhat notorious for having ongoing issues that should have been dealt with years ago?

Anyways, I do enjoy flying the Q (or any dash for that matter) but he makes it sound like the Q400 is the greatest thing since sliced bread.

Quoting Quantos (Thread starter): The Extended Service Program will extend the service life of Jazz's Dash 8-300 aircraft by 50 per cent, or approximately 15 years

I think Widerøe in Norway will be interested in this too.

Congrats to BBD and Chorus, nice to see some new Q400 orders.

Quoting diverted (Reply 1): Anyways, I do enjoy flying the Q (or any dash for that matter) but he makes it sound like the Q400 is the greatest thing since sliced bread.

Welp, it's a press release. I don't expect things such as real numbers to affect what anybody says in a press release!

^ Oh of course not. Just funny.

I'll agree with him on the comfort aspect though; Prefer the Q to an RJ or an ATR...put me at the back where it's quietest and I'm a happy camper.

Good news for Jazz.

Looking at the retirement of the -100s, obviously most of these routes will begin to be served by the -300. I would then assume that many current -300 routes will have to be replaced with the Q400.

I am wondering, though, are there any current -100 or -300 routes that could NOT be served by the Q400 on a technical level? I am thinking things such as runway length, terrain, tarmac space, etc. Range wise it could definitely do any of them.

Quoting diverted (Reply 1):

While in many other places in the world, the ATR rules, N.American airlines seem to prefer the Q400. Basically, most if not all big orders there have been for the Q...even when turboprops compete head to head.

Quoting diverted (Reply 1): Anyways, I do enjoy flying the Q (or any dash for that matter) but he makes it sound like the Q400 is the greatest thing since sliced bread.

I think you'll find press releases are typically slightly less than objective pieces of shoeleather reporting...

Quoting Boeing744 (Reply 5): I am wondering, though, are there any current -100 or -300 routes that could NOT be served by the Q400 on a technical level? I am thinking things such as runway length, terrain, tarmac space, etc. Range wise it could definitely do any of them.

I can't think of any in the current network. Most of the destinations that currently get Dash 8s have gotten larger types in past (DC9, 146 and/or 737). YCG might have some issues but I really doubt the Q400 would have any issues the -100/-300 wouldn't there.

Interesting that the -300's are going to a new operating unit (airline) operated by Chorus. Jazz Rouge?

Quoting diverted (Reply 1): Didn't realize that 7F's fleet of ATR72's doesn't seem to be counted as "a large turboprop aircraft."

according to airfleets.net and planespotters.net both of 7F's are older second hand 1995 build examples. one is a ATR74-212 and the other is a ATR-212F. I believe the press release was referencing its new build market share.

Quoting briboy (Reply 9): Interesting that the -300's are going to a new operating unit (airline) operated by Chorus. Jazz Rouge? next up: YYC, SFO, SYD, AKL, WLG, CMB, BKK, SIN, FRA, VCE, JFK

Where do you see this?

Quoting whiteguy (Reply 11): Where do you see this?

From a Chorus Aviation press release announcing their new CPA with Air Canada:

Quote: The overall fleet plan calls for the addition of 23 78-seat Q400s that will gradually replace 34 37-seat Dash 8-100s, and 25 50-seat CRJ-200s over the next 11 years. The fleet of 26 Dash 8-300s will continue to operate to 2025. The transition gradually reduces the minimum number of aircraft from 122 to 86 over the term of the agreement which translates to a reduction in overall seat capacity of less than 9% by the end of the 11 year period. This simplification and modernization of the fleet will deliver significant cost efficiencies that will provide the economics required to maintain a significant long-term presence in Air Canada's regional network. In order to achieve the right economics with the older fleet of Dash 8-100 and Dash 8-300 aircraft, the business will consist of two operating units. The first unit, which is Jazz, will transition to a mix of larger, newer aircraft comprised of Q400, CRJ 200 and CRJ705 aircraft. The creation of a second airline will address the requirement for improved economics of the older Dash 8-100/300 fleet. This unit will be similar to Air Canada's rouge as it will have its own work force.

Source: http://chorusaviation.ca/2015-02-02-...-Agreement-with-Air-Canada-to-2025

Quoting aamd11 (Reply 12): Quote: The overall fleet plan calls for the addition of 23 78-seat Q400s that will gradually replace 34 37-seat Dash 8-100s, and 25 50-seat CRJ-200s over the next 11 years. The fleet of 26 Dash 8-300s will continue to operate to 2025. The transition gradually reduces the minimum number of aircraft from 122 to 86 over the term of the agreement which translates to a reduction in overall seat capacity of less than 9% by the end of the 11 year period. This simplification and modernization of the fleet will deliver significant cost efficiencies that will provide the economics required to maintain a significant long-term presence in Air Canada's regional network. In order to achieve the right economics with the older fleet of Dash 8-100 and Dash 8-300 aircraft, the business will consist of two operating units. The first unit, which is Jazz, will transition to a mix of larger, newer aircraft comprised of Q400, CRJ 200 and CRJ705 aircraft. The creation of a second airline will address the requirement for improved economics of the older Dash 8-100/300 fleet. This unit will be similar to Air Canada's rouge as it will have its own work force.

Interesting, thanks.

Quoting diverted (Reply 1): Quoting Quantos (Thread starter): "We are delighted that Chorus and Jazz continue to put their confidence in the Q400 NextGen turboprop, relying on the aircraft to provide service from coast to coast in Canada and the United States," said Mike Arcamone, President, Bombardier Commercial Aircraft. "With its unbeatable economics, in-service performance and excellent passenger comfort, the Q400 NextGen aircraft is widely regarded as the proven choice for North American carriers looking for large turboprop aircraft and it continues to be a segment in which we've retained 100 per cent market share." Didn't realize that 7F's fleet of ATR72's doesnt seem to be counted as "a large turboprop aircraft."

I don't believe a new ATR72 has ever been sold to a Canadian customer.