Oct 2, 2009
Bradley Perrett/Beijing
[email protected]
U.S. regional airline owner Trans States Holdings has broken the sales drought for the Mitsubishi Regional Jet, signing a letter of intent for 50 of the aircraft with options on 50 more.
Deliveries will run for five or six years, beginning in 2014, the year in which Mitsubishi Aircraft expects to deliver the first unit to launch customer All Nippon Airways.
The deal is a breakthrough for the manufacturer on several fronts. It reinforces confidence in a program that previously had only 15 orders placed by a single customer 18 months ago, brings the endorsement of a significant regional jet operator, and puts the MRJ into the key market--North America.
Trans States Holdings can later choose which version or versions it wants to fill its order. The aircraft comes in two sub-types, the 78-seat MRJ70 and the 92-seat MRJ90. Mitsubishi Aircraft is considering offering a 100-seater, the MRJ100.
The buyer owns two airlines: Trans States and GoJet, which operate a total of 63 regional jets on feeder services for United and US Airways. In buying the MRJ, the company has chosen not to top up its Bombardier CRJ fleet with more aircraft from the same manufacturer. According to Trans States, the 50 MRJs are not destined to be used under any existing airline contract; rather, it is now pitching to all majors that have contracts set to expire in the middle fo the next decade. Trans States expects to formalize the LOI into an order soon.
The value of the deal has not been announced, and it will depend on the buyer's choice of versions. The MRJ90 has a list price of $40 million, so the 50 aircraft on order would be nominally valued at $2 billion, with another $2 billion for the options, if they are taken up.
"The world has high expectations for the MRJ," says Mitsubishi Aircraft President Hideo Egawa. "One area where this is especially true is the U.S., with many routes where airlines operate 50- to 90-seat regional jets, so we are extremely proud to receive this order from one of the largest regional airline holding companies in the U.S. We would like to take this opportunity to further ramp up our sales activities around the world."
While airlines routinely endorse aircraft when they place orders, Trans States Holdings President Richard Leach goes as far as calling the MRJ "spectacular."
"By combining the largest cabin in the regional jet market with the innovative seat design and very quiet cabin, we will be able to offer our passengers the best comfort of any regional jet," he says.
Egawa says the design is proceeding smoothly. Last month Mitsubishi Aircraft decided on a major design change, deciding to build the wing of metal instead of composite. It said the design allowed it to lighten the weight of the MRJ70.
All Nippon took options on 10 MRJs when it placed its launch order in March last year.
Artist's concept: Mitsubishi
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