By Rebecca Rayko,
AWN Editor

SAN ANTONIO, Texas - Fairchild Aerospace predicts the demand for regional aircraft will be even higher than originally predicted due to a number of dynamic market drivers.

"We could see as many as 1,000 additional aircraft added to earlier 20-year forecasts due to changes in the marketplace," said Mike Miller, Fairchild's director of economic analysis. The addition pushes total aircraft demand to 9,000.

Regional airline traffic will increase 8% annually through 2020, and demand for aircraft across all seat ranges (30- to 110-seaters) will total more than $200 billion in value.

Additional growth drivers involve market fragmentation, which includes hub bypassing, hub relief and hub raiding. All of these drivers stem from the introduction of the regional jet.

"Given current order activity, future deliveries in the regional sector will likely be 85%-90% regional jets," said Miller.

There was a balanced turboprop-regional jet delivery pattern seen through most of the 1990s, but regional jets have really caught up in the last 3-4 years, Miller said.

There is also a greater than usual process of aircraft replacement by the airlines. Upcoming orders will come from US majors with large turboprop fleets to replace, such as US Airways, Northwest, and United.

It is likely we will see more large aircraft orders similar to the Delta CRJ order last month, as the majors look to refleet their regional partners/subsidiaries. Operators are now under more pressure to replace turboprops with jets more quickly than originally planned to maintain load factors, Miller said.

It is important to note that the Fairchild forecast does not take into consideration external market constraints such as the scope clause (see related story).

The forecast also includes aircraft up to 110 seats as replacement targets, while earlier company forecasts went only as high as 90 seats.

"Aircraft from traditional regional manufactures are becoming larger as the regional carriers see increased traffic and greater alignment with major carriers," said Miller.

With market forces working as predicted, the carriers are going to look at these new larger "regional" jets as being the perfect size for their changing requirements.