New Entry in the Compact-Jet Market

The roar of publicity over such super-commercial airplanes as the SST and Boeing's 747 jumbo jet has largely drowned out the hum of a smaller but still important market. Lured by the economy of jet planes and lifted by their earnings from increased traffic, regional airlines around the U.S. have been moving into the jet age, casting off decrepit DC-3s and aging Convairs, which gave them their start. British Aircraft Corp., with its BAC-111, and both Boeing and Douglas have tapped the regional market with small, fast jet airplanes designed for short runs and shorter runways.

Halting Costs. Last week an unexpected new entry moved in for a share of the compact-jet market. Fairchild Hiller Corp. of Hagerstown, Md., announced that it will soon begin U.S. production of the F-228, a twin-engine jet that will carry from 50 to 60 passengers, cruise at 500 m.p.h., give optimum performance on the 100-mile to 200-mile hops that are the bread and butter of the regionals. Fairchild will produce the plane in cooperation with Royal Netherlands Aircraft Factories Fokker. Since the Dutch company has already designed the plane and built its prototype, the F-28, Fairchild Miller's development costs will be shaved in half. In addition, the U.S. company will sell the F28 in the Western Hemisphere, purchase such F228 components as the tail assembly, wing segments and a shortened fuselage from the Dutch, and will use Rolls-Royce turbofan engines that have been specifically designed for the F-228. The company, as a result, hopes to keep its cost $1,000,000 below the $3,500,000 to $4,000,000 price tag of competing compact jets.

Though it has yet to win a single order for the F-228, Fairchild Hiller is enthusiastic about its chances. "We could sell at least 40 of them right now if businessmen knew when and if the 7% investment tax credit would be reinstated," says James T. Dresher, general manager of the company's aircraft division. Dresher forecasts that the eventual U.S. market will be 260 to 460 planes, expects worldwide sales to reach 600 or 800 once they begin to roll off the company's production lines in 1970. And along with sales prospects among airlines, Fairchild figures that its low-cost, economically operated jet could make an attractive executive airplane for corporations.

Doubling Sales. The F228 flies in the prop wash of Fairchild Killer's ubiquitous C-119 Flying Boxcars and C-123 transports. Financially troubled during the late 1950s after these contracts ended, the company flew low for a few years, picked up altitude with orders for its F-27 and F227 propjet airliners and for helicopters. In September 1965, Fairchild Hiller acquired Republic Aviation Corp., suffering at the time from production phase-outs of the F-105 fighter-bomber, and subsisting on F-105 modification orders and subcontracts from other aerospace companies.

Since then, Fairchild Hillers sales have climbed from $115 million to $210 million for 1966. Along with the F-228, the company is engaged as a major subcontractor on the McDonnell F4, the Boeing 747, the SST, and it is working with West German designers on what could be a multibillion-dollar verticaltakeoff and landing aircraft. With such projects under way, Fairchild President Edward G. Uhl's forecast of doubled sales within the next six years seems somewhat conservative.

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