Porter Airlines of Canada to Double Fleet with Large Order of Embraer Aircraft

SAO PAULO July 12 (Reuters) – Porter Airlines is exploiting the opportunities of the COVID-19 pandemic with a firm order for 30 Embraer E195-E2 jets that will double the Canadian carrier’s fleet and allow it to add new routes to the United States United, Mexico and the Caribbean, CEO Michael Deluce said on Monday.

Previously, Brazilian aircraft maker Embraer SA (EMBR3.SA) said Porter was the mystery buyer behind an order for up to 80 E195-E2 jets, a deal previously announced in May. Porter has placed an order to purchase a record 30 jets and options for 50 more, for a total value of $ 5.82 billion based on list prices, Embraer said.

Embraer shares rose 6% in early afternoon trading in Sao Paulo.

The order, the largest ever for Toronto-based Porter, is part of an overhaul of Canada’s post-pandemic airline industry. Small, ultra-low cost carrier (ULCC) Flair Airlines introduces cross-border service, increasing price pressure as market leader Air Canada (AC.TO) restores routes. [nL2N2OJ2MZ]

“It will definitely be very competitive,” Deluce said in an interview.

Like their global peers, Canadian carriers have been beaten during the pandemic with plummeting flights due to strict travel restrictions. But the pandemic has also led to growth opportunities, in particular by reducing the cost of acquiring aircraft.

“The pandemic has created acquisition opportunities that weren’t available before,” Deluce said, without giving details on pricing. “We were looking at various growth plans, but I think the details really emerged during the pandemic.”

United Airlines (UAL.O) announced at the end of June its largest order on record for Boeing (BA.N) and Airbus (AIR.PA) planes in a bid to boost post-pandemic growth read more.

Porter resumes flights on September 8 after suspending travel for nearly 18 months. The carrier operates 29 DeHavilland Dash 8-400 turboprop engines and competes by offering perks such as free drinks and snacks, at a time when its competitors are moving towards billing for onboard services.

But while fuel-efficient turboprop engines are helping Porter cut costs, their limited range has limited the airline’s growth potential.

The E195-E2 jets would allow Porter to fly to new US, Mexican and Caribbean destinations from Canadian cities like Toronto and Montreal, although new routes have yet to be announced. The jets will enter service from the second half of 2022.

Embraer has ordered up to 280 E195-E2 aircraft, a mix of firm orders and options.

Porter will be Embraer’s first North American customer for the E2 line.

Report by Marcelo Rochabrun in Sao Paulo and Allison Lampert in Montreal Editing by Paul Simao

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