Before talking about the rescue of the CRJ aircraft program, it is important to assess whether there is still a market for regional jets.
In 2017, Bombardier delivered 18 CRJ-900s and 7 CRJ-1000s for a total of 25. For its part, the competitor Embraer delivered 74 E-175 and 12 E-190s for a total of 86 Ejets, the size of which is similar. 111 regional jets the size of the CRJ were delivered in 2017 and this is a sufficient market to guarantee the survival of two aircraft programs. The problem is that the CRJ has lost significant market share to the Ejet, which is less expensive.
The fact that the CRJ is a program that is 26 years old has nothing to do with its setbacks; the Boeing 737 is over 50 years old and yet the latest version of the B737MAX has an order book of nearly 4,800 aircraft while the A320NEO order book is at nearly 5,600 aircraft despite the 32-year program. Like the B737 and A320, the CRJ has received several upgrades. In order for the CRJ to see its sales increase and go back to a minimum of 50% of market share, it will have to reduce its production cost and that is exactly what Bombardier’s President Alain Bellemare says.
On November 12, Addison Schonland of the Airinsight.com website analyzed Alain Bellemare’s statement on the non-profitability of the CRJ as follows:
In other words, Bombardier no longer has an appetite for operating a program it can’t make a decent return on.
Mr. Schonland raised the need for airlines to have a choice between two suppliers to avoid a monopoly that would drive up the price of regional aircraft. According to journalist Jean-Philippe Décarie in La Presse Plus on Saturday, November 17, Alain Bellemare met the executive of four US airlines operating CRJ to discuss with them the fate of this program. That the airlines operating the CRJ have asked to meet Alain Bellemare to discuss his fate is an evidence of the importance they place on the survival of this program.
In Quebec, the IAMAW union coordinator, Mr. Dave Chartrand, was the first to raise the need to protect the production of the CRJ during the emergency meeting held on November 12th. Then after meeting with Bombardier’s President, it was Pierre Fitzgibbon, Minister of Economy and Innovation, who declared that he was ready to provide assistance to enable Bombardier to find a partner for the CRJ.
So there are two important stakeholders here who say that they will participate in the rescue of the CRJ if the situation requires it. It remains for the entrepreneurs of the Montréal aerospace cluster to assess the relevance of maintaining a commercial aircraft program here with all the expertise that it entails and the opportunities that comes with it.>>> Follow us on Facebook and Twitter