Fast growing no-frills airline flybe - one of the main operators at Birmingham International Airport - is to buy more than two dozen new jets from Brazilian manufacturer Embraer in a deal worth about $ 950 million (£524.8 million).
Flybe, now one of the top five European low cost carriers, yesterday said it had placed firm orders for 14 Embraer 195 airliners, with options on a further 12 aircraft.
The deal comes hard on the heels of a $1 billion (£552.4 million) purchase of up to 61 Q400 aircraft from Canadian company Bombardier.
Flybe will deploy the new Embraer aircraft at its major bases in Birmingham, Southampton, Belfast, Exeter, Jersey, Guernsey, Edinburgh and Glasgow.
The airline has a 39-strong fleet, but will have a total fleet size of between 59 and 91 aircraft by 2009 - depending on the number of options it takes up.
Flybe said its chose the new Embraer planes because of their standards in operating costs, environmental performance and in-flight cabin services. They will replace its existing fleet of British Aerospace made planes.
The order is a loss for manufacturers Airbus and Boeing , which had been in talks to sell the UK carrier larger planes.
Chairman and managing director Jim French said the aircraft had seat costs for short-haul flights that were comparable with larger jets.
"The Embraer 195 is ideally suited to meet the needs of our domestic and regionally focused business model," he added.
"The airplane has seat costs on the sector lengths we fly which are comparable with larger jets, while with 118 seats has a capacity level which suits the thinner UK regional markets we serve.
"In short, the Embraer 195 allows us to deliver our famous low fares to all the regions we serve, and allows us to do it profitably, while at the same time increasing the number of regions we can serve with direct European services."
Mr French continued: "The 195 will replace our 146 BAe fleet, and bring cost and service efficiencies.
"It completes our fleet rationalisation strategy commenced in 2003 and will give us the youngest fleet in the airline sector.
"It also means that the business has addressed the strategic question of how to replace the 146 and provide a tenyear platform for profitable growth."
Mauricio Botelho, chief executive of Embraer, said: "As one of Europe's leading low cost airlines, Flybe honours us with its selection of the Embraer 195, the last member of the new family of Embraer airliners.
"Flybe's choice is yet another testimony of the capabilities and rightsizing factor of our family of aircraft."
Flybe, which was formerly known as British European, operates 101 routes from 41 airports in seven countries.
It is expected to carry 5.6 million passengers and generate revenues of £300 million in the current financial year.
Flybe is owned by a private trust belonging to the family of the late Jack Walker, a multi-millionaire who made his fortune in steel and bankrolled English soccer club Blackburn Rovers to success.
It has been expanding rapidly in recent years, and Mr French said the order put it on track for the possible flotation or sale.
"This order positions us very well for aspirations to float or whatever because it addresses our fleet issue and we have gone back to a definite twofleet strategy," he said.