Porter Airlines is launching the Embraer E2 in North America with the introduction of up to 80 Embraer E195-E2s into its fleet. The planes have a transcontinental range and should enter into service with Porter starting in the second half of 2022. Porter Airlines acquiring up to 80 Embraer E195-E2s
The total aircraft order is valued at up to $5.82 billion at current list prices, with 30 firm commitments and 50 purchase-right options. The aircraft are being acquired by Porter Aircraft Leasing Corp., a sister company of Porter Airlines. Several lessors helped put the deal together. Funds for the aircraft purchase are being raised privately from shareholders, as well as through aircraft sale-leaseback agreements.
The ability to convert purchase rights to smaller E190-E2s is included in the agreement. This provides opportunities to introduce non-stop service in markets where connecting flights are often the only option today. It also enables higher-frequency service for routes with greater demand. Porter intends to operate the E2s to popular destinations from Ottawa, Montreal, Halifax, and Toronto Pearson International Airport. The introduction of specific routes will be determined in advance of aircraft deliveries.
“We are bringing Porter’s distinct style of service to dozens of new North American cities,” said Michael Deluce, president and CEO, Porter Airlines. “We believe that now is the right time to make this investment as the pandemic resets the aviation landscape. Adding a diverse selection of popular business and leisure destinations to our network means that we are better positioned to serve the needs of many more passengers.”
While establishing service at Pearson Airport for the first time, flights from Porter’s existing hub at downtown Toronto’s Billy Bishop Airport remain core to its business and will continue with high-frequency regional service on turboprop aircraft. The E2s will not operate at this airport.
“Our commitment to Billy Bishop Airport is not changing,” said Robert Deluce, founder and executive chairman, Porter Airlines. “Our corporate headquarters at Billy Bishop is being maintained and we will continue serving the same network of regional markets from downtown Toronto. We are moving beyond this existing footprint to welcome more travelers across North America, with an emphasis on providing the sophisticated service that only Porter delivers.”
Extra range opens door to new destinations
The E195-E2’s range allows for the creation of a continental route network. Potential markets reach coast to coast in Canada and the United States, including U.S. sun destinations, plus Mexico and the Caribbean. A destination map is available at www.flyporter.com, with initial routes to be announced in 2022.
“With this order for up to 80 of our largest aircraft, the E2 is making a stunning North American debut,” said Arjan Meijer, president, and CEO, Embraer Commercial Aviation. “As the quietest and most fuel-efficient aircraft in the segment, the E195-E2 also delivers excellent economic performance that shines through.”
Canada-based aerospace companies contribute greater than 37% of the E2’s main systems. The engines are produced by Pratt & Whitney Canada in Quebec. Additionally, Ontario-based Thales produces select avionics and Quebec-based Alta Precision the main landing gear. Porter’s purchase supports skilled jobs and ongoing innovation within this important economic sector.
“The support of our board of directors and shareholders was crucial in deciding to invest in Porter’s future,” said Don Carty, chairman of the board, Porter Airlines. “We have investors, partners, customers, and team members who have been with us from day one, while others joined at different points along the way. It’s time for us to collectively build on the exceptional global reputation that we’ve built for Porter and continue our journey.”
This deal may be a harbinger of what we can expect going forward from Embraer. They cannot compete against Airbus directly (i.e. Airbus has a much broader portfolio which they use to disrupt deals – like at JetBlue for example) so they must be more nimble and creative. Porter is an ideal customer for Embraer.
Porter didn’t show on Airbus radar and the original CS100 deal Porter made several years ago too many contingencies to work. Far too many for Airbus to focus on and that deal was quietly dropped. We still have this flag that was handed out when the CS100 deal was announced.
So being creative, Embraer strikes a deal with Porter that allows passengers to experience a new kind of cabin on longish flights.
Note that Porter will not use the E2 out of Billy Bishop (which was planned for the CS100) – they will have to face competitors at airports like Pearson and Trudeau and this competition will be fierce. LCC Flair will give them no margin chasing snowbirds and Flair’s MAX8s provide formidable cost competition. Then there’s Air Canada and WestJet to further add pressure. Even an uncertain AirTransat is a threat. For Porter to survive requires two key items: lowest costs and something different for the passenger.
Can the E2 offer lower costs than competitors as well as something different?
- Embraer claims it is capable of this but we have to wait and see the real-world performance. Specifically, that means how Porter operates the E2. The aircraft is highly capable as Helvetic has demonstrated. We are confident the E2 will perform, but the E2 is a big jump for Porter.
- Can Porter offer passengers something different/better? Here the E2 offers a nice two-by-two cabin but once again, it is the real-world experience that makes the difference. Porter will need to be creative with their passenger experience as they were getting Dash8 service going. The advantages they have at Billy Bishop won’t help them with the E2. The company’s culture is what must pull them through as they face much bigger competitors. The E2 can only do so much, so Mr. Porter’s friendly and clever raccoons are going to have to work extra hard.