Analysis: Bombardier, Embraer Battle For Bronze In Commercial Jet Market
By Susan Taylor, Nicole Mordant and Brad Haynes/Reuters
PENT-UP U.S. DEMAND
The biggest U.S. airlines have been the major holdouts against the trend to larger regional jets. Labor agreements long defined regional fleets as planes under 50 seats, a clause that restricted carriers to smaller airplanes as mainline pilots resisted the outsourcing of more flying to cheaper partner operations.
The loosening of those clauses in new labor contracts because of airline bankruptcies and mergers is expected to prompt a string of deals to overhaul the U.S. regional jet fleet. There could be demand for between 250 and 400 planes in the next 18 months, Embraer’s Silva says.
Industry sources say Bombardier has started linking its sales pitch to an offer to help airlines re-sell their older Bombardier planes as they upgrade their fleets, a newly aggressive approach that they say was a key factor in winning the Delta order.
Bombardier would not reveal details of the deal, but a spokesman said it has helped other airlines find “new homes” for CRJs, or Canadair Regional Jets, in such growth markets as Russia and Africa.
The stronger sales pitch would come just as the Montreal-based company needs cash to fund expensive development programs, particularly for its $3.4 billion, 110- to 149-seater C-Series. Bombardier sees its biggest jet yet as central to future growth.
REGIONAL-JET ARMS RACE