The airport buys Embraer-120 for Rusline

Koltsovo Airport, controlled by the Renova group, is buying four Embraer-120 regional aircraft for a total of about $10 million. This is an unprecedented case for both the Russian and international markets. Koltsovo is trying to establish regional transportation around the airport in this way. The aircraft will be operated by Rusline Airlines, which will receive them on preferential terms.

As several sources in the aviation market told Kommersant, Viktor Vekselberg’s Renova group is negotiating the purchase of four Embraer-120 aircraft (50 seats) from the Regionavia airline for a total cost of approximately $10 million. The aircraft will be put on the balance sheet of Yekaterinburg Koltsovo Airport (50 19% belongs to Renova). They will be operated by Rusline Airlines, which will take the aircraft under operating lease on preferential terms. The carrier will also hire pilots working on these aircraft. Rusline should use the Embraer-120 only on regional routes from Koltsovo. We are talking, for example, about flights to Samara, Ufa, Kazan and Novosibirsk.

Koltsovo declined to comment on the purchase of the aircraft. Regionavia and Rusline confirmed the fact of negotiations with Koltsovo, but refused to discuss the details.

Rusline is based at Moscow Domodedovo Airport. Provides regional transportation from Moscow, Volgograd, Yekaterinburg, Irkutsk and St. Petersburg. The company's fleet consists of nine CRJ-200 aircraft (50 seats), six of which are based in Moscow, two in Yekaterinburg and one in Irkutsk. In 2010, the airline carried 23.86 thousand passengers.

Koltsovo is one of the five largest airports in Russia; in 2010 it served 2.74 million people. 50.19% is owned by Koltsovo-Invest OJSC (controlled by Renova), another 46.08% of shares are on the balance sheet of the Federal Property Management Agency.

Now Embraer-120 is owned by a related structure of Regionavia, the foreign ABC-leasing, which is 100% owned by one of its foreign founders. Regionavia itself suspended flights at the beginning of the year, but its owners promise that they will maintain the validity of the operator’s certificate and will soon enter the market with a new project. Details have not yet been disclosed; it is only known that we are talking about the regional transportation segment.

The head of the analytical department of Aviaport, Oleg Panteleev, notes that we are talking about a unique scheme for the aviation market, when the owner of the aircraft becomes not a leasing structure or an airline, but an airport. The expert says that with the help of this combination, Renova managed to attract both management familiar with such transportation and regional aircraft, which are now in short supply on the market, to the development of the regional route network in Koltsovo. In addition, the expert adds, Rusline itself would hardly be able to spend $10 million on new aircraft.

But Vladislav Borodulin, director of strategic development at Pulkovo Airport, calls the deal “unnatural,” emphasizing that leasing aircraft is not the business of airports. The expert notes that we are talking about a return to Soviet practice, when airlines were merged with airports and held each other back in development. “The project is very risky,” says Vladislav Borodulin, explaining that it will not be able to pay off soon, will restrain free competition in Koltsovo and divert the labor resources of its management.

Ekaterina Sobol

Koltsovo takes over the planes