Deutsche Aircraft bets on fuel-efficient planes in German industry revival

By Gianluca Lo Nostro

Sept 29 (Reuters) - Deutsche Aircraft is hoping high fuel prices will revive interest in its delayed, more fuel-efficient D328eco aircraft, the German planemaker said as it opened a €100 million ($114 million) assembly line in Leipzig on Tuesday.

The aircraft, which uses turboprop propeller engines, entered development in 2020 and is scheduled to be in the air in early 2027.

"The fuel price has gone up dramatically. A turboprop is by nature 30% to 40% more fuel-efficient than comparable regional jets. That's an upside," CEO Nico Neumann told Reuters.

The project is unusual in Europe, where commercial aircraft manufacturing is dominated by Airbus and there are relatively few active aircraft programmes.

But the programme faced delays after its launch, as the COVID-19 pandemic and Russia's invasion of Ukraine disrupted global supply chains.

"A lot of stuff went already wrong and I think we have shown our resilience. We adapted to the new situation," Neumann said.

Fully owned by US aerospace firm Sierra Nevada Corporation, Deutsche Aircraft is developing the D328eco as a modern successor to the Dornier 328 regional turboprop introduced in the 1990s.

Designers say the plane retains its predecessor's speed and short-runway capabilities but adds a Pratt & Whitney Canada engine designed to run on up to 100% sustainable aviation fuel, or SAF, and a revamped landing gear.

Other planemakers and their engine suppliers have said their engines are being tweaked to accommodate 100% SAF, though the fuel remains in short supply. 

Neumann said the company had secured 134 letters of intent backed by customer deposits and expected many to be converted into firm orders. The Leipzig factory will produce up to 48 aircraft a year.

"Germany has quite a background in aviation, and it hasn't had any own OEM (original equipment manufacturer) for the last decade. I think an industrial country like Germany needs to have its own OEM."

The German government supports Deutsche Aircraft and is part of a risk-sharing loan, according to Neumann. The planemaker estimates it can capture over a third of the total addressable market of 3,800 aircraft.

($1 = €0.8790)

(Reporting by Gianluca Lo Nostro in Gdansk, editing by Milla Nissi-Prussak)