Thursday, February 28, 2008

Two of the world's regional aircraft makers are doomed to fail


I did an interview at last week's Singapore Airshow with Embraer's tech guru Satoshi Yokota where I posed the question 'which regional jet aircraft makers will be around 20 years from now?'
Satoshi stopped short of giving his forecast for the future but he did say he thinks the market can only support three.
Today the dominant players are Bombardier and Embraer (and not necessarily in that order).
There is also China Aviation Industry Corp. (AVIC) I, which is building the 90-seat ARJ21-700 and 105-seat ARJ21-900; Sukhoi with its 95-seat Superjet 100; and Mitsubishi Heavy Industries is developing the 70-80 seat Mitsubishi Regional Jet MRJ70 and the 86-96 seat MRJ90.
Satoshi says the industry consolidation that occurred with large aircraft manufacturers will also occur with manufactures in the regional jet aircraft market.
"Its like with the big jets...Lockheed, McDonnell Douglas and so on are all gone" and now there are only two major players, says Satoshi referring to today's industry heavyweights Airbus and Boeing and the withdrawal of Lockheed in 1984 and McDonnell Douglas' merger with Boeing in 1997.
"Can you have a third player" in the regional jet aircraft market?, Satoshi asks rhetorically.
"Probably", he says.
Who that third player will be is anyone's guess.
Satoshi is Embraer executive VP strategy planning and technology development.

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