Regional conundrum

The economy of regional airline services is much more intricate than the principles applied to mainline air transport. Among the key problems in this sector are the low purchasing power of the population and the high specific costs associated to the smaller seating capacity of regional aircraft and the relatively short route legs they are operated on. This is why, whenever the mainline segment in Russia enters periods of stagnation, the regional air services market begins to shrink; similarly, the recent explosive growth of mainline airline transport has been accompanies by very insignificant improvements on the regional market.

Another problem is that an effective method of interaction between the network and feeder carriers was never really introduced in Russia. The majority of regional and local carriers are therefore unable to accumulate enough capital to purchase new equipment, so continue to operate Soviet-made aircraft. As a result, these airframes are fast approaching the end of their service life, and regional carriers lack not just money for fleet renovation purposes but even reliable business models that could attract external funding.

This unfortunate state of affairs prompts market players to seek inexpensive solutions to the problem of ageing regional fleets. The range of options for airliners seating over 50 passengers is more or less obvious; as for smaller aircraft, a great many projects of varying feasibility are being proposed.

Single-engine aircraft