Regional Aviation
Asia-Pacific airlines lead demand for regional jets
Airlines with fleets of smaller jets and turboprops have long taken a back seat when orders are announced but as Farnborough proved, there are signs the sector will surge.
September 1st 2016
Despite the fact that the Commercial Aircraft Corporation of China’s (COMAC), ARJ-21 regional jet made its June commercial debut ten years behind schedule it does not mean it is without customers. Read More »
After the ARJ21’s first flight with Chengdu Airlines, China Aircraft Leasing Co. (CALC) placed a $2.3 billion order for 30 of the aircraft type, with options on another 30, at the Farnborough Air Show. It is the largest single order for the 78-90 seat jet. They will be delivered in the next five years to an as yet unnamed Indonesian carrier that CALC associate company, Friedmann Pacific Asset Management, is supporting. Mainland funded COMAC will establish maintenance and after-sales offices in Indonesia as part of the deal.
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| John Slattery, CEO Embraer Commercial Aircraft: Brazil’s Embraer has sold five of its new E190-E2 jets with five options to Indonesian regional airline, Kalstar Aviation |
The Chinese manufacturer was not the only new entry manufacturer to breakthrough at Farnborough. Mitsubishi Aircraft Corporation, the maker of Japan’s first passenger jet, won an order for as many as 20 of its new MRJ (Mitsubishi Regional Jet) from Swedish leasing company, Rockton.
It was the second order for the airplane following a deal earlier this year to sell 20 of the jets to U.S. lessor, Aerolease Aviation. The MRJ is Japan’s attempt to break the regional-jet duopoly of Brazil’s Embraer and Canada’s Bombardier. Mitsubishi is producing two versions of the MRJ, which can seat 78 to 92 passengers.
The Japanese jet made its inaugural flight last November with the manufacturer scheduled to deliver its first aircraft, to launch customer All Nippon Airways, in mid-2018. It has 427 orders for the jet, including options and purchase rights.
At Embraer, the Brazilian manufacturer has signed a firm order for five of its new E190-E2 regional jets plus purchase rights for another five of the aircraft with Indonesia airline, Kalstar Aviation. Established in 2007, Kalstar connects passengers to cities in the province of Kalimantan, an area known for mining and agriculture.
The airline operates an E190 and two E195s on domestic routes in Indonesia. “Kalstar Aviation has taken a differentiated path in the Indonesian market by utilizing current generation E-Jets, and soon the E2s, to grow their business sustainably and provide their passengers with an unparalleled cabin experience,” said John Slattery, president and chief executive of Embraer Commercial Aviation.
Said Kalstar’s chief executive Andi Masyhur: “We are looking forward to the enhanced performance and economics that the E190-E2 brings, while still maintaining a high level of cockpit commonality with the existing E-Jets. This means an easy transition for our pilots when they operate both the current E-Jets and the E-Jets E2.”
Overall, the future for regional flying appears favourable. In its latest market outlook to 2035, Embraer projected global airlines will require 6,400 new jets, worth US$300 billion, in the 70-130 plus seat sector, 2,300 aircraft in the 70-90 seat market and 4,100 90-130 aircraft.
The Asia-Pacific will lead demand with 31% of the market followed by North America (26%), Europe (18%) and South America (11%).
Turboprops will also be in demand, said European manufacturer, ATR. It forecasts 3,000 new short-haul routes will be flown by turboprops in the next two decades fed by demand for regional connectivity.
Almost 50% of the new services will be in the Asia-Pacific, including the forecast fastest growing market, Mainland China. About 1,400 new routes are predicted to be established in the Asia-Pacific, followed by North America (800) and Europe, Africa and the Middle East accounting for the rest.
To 2035, ATR anticipates an annual average growth rate in regional traffic of 3.9%, or 2,800 new turboprop aircraft worldwide. Demand for regional connectivity is not only increasing in key markets such as India and China but also in Iran, Japan and the U.S., ATR said.
By 2035, the Asia-Pacific, excluding China, will have the world’s largest fleet of operating turboprops, up from 640 in 2015 to 1,180 in 20 years. China’s turboprop fleet is forecast to increase from 35 in 2015 to 320 by 2035.
