The lingering question for the 100-seat class is whether a market truly exists for such aircraft. After all, mid-sized regional jets span well into the 80- to 90-seat range, and small airliners like the Airbus A318 and Boeing 717 have not proved popular. But many contend there is room for growth at the higher end of the regional-jet market.
Proponents see the 100-seat class as the next phase of growth for the industry, one reason why JetBlue's launch of large regional-jet service this year will be so closely watched. The airline's use of the Embraer 190 for high-frequency service to mid-sized markets will impact not only other low-fare carriers but the majors too.
"JetBlue may be the catalyst to get the legacy airlines to want their regional partners to have larger RJs in their operations," says Raymond James airline analyst Samantha Panella. Like other observers, she predicts that 100-seaters and above will be narrowbody replacement aircraft at the legacy carriers.
Manufacturers believe there is a significant void to be filled between the 70- and 110-seat markets. The question is whether the major airlines will follow JetBlue's example and operate the aircraft for themselves.
JetBlue will take delivery of seven E-190s this year, beginning in August. By 2008, it expects to operate 61 and by 2011 it will have 100 aircraft. JetBlue will deploy its E-190s on routes that do not make sense for its A320 narrowbodies, says Panella. "There's a gap between the 70- and 110-seat aircraft markets where there is a lot of traffic. That was Embraer's target when it launched its larger RJ."
Another favourable sign for the large regional jet market is the latest trend towards scope relief, says Warren Wilkinson of Republic Airways Holdings. The holding company for Chautauqua, which operates Embraer's ERJ-145 family, and Republic Airlines, its platform for the E-170 and potentially for larger E-190/195s, was established to meet the growing demand for larger gauge aircraft, he says.
Wilkinson believes that the ongoing restructuring of the US legacy carriers will lead to a convergence of low-cost carriers and regionals operating 90-plus-seat aircraft. Also, the rapid and sustained growth of low-cost carriers and the diminished premium-priced air travel market will force the legacy carriers to continue to shift their smaller narrowbody flying to regional operators such as Republic, he says.
"We think it is worth noting that ALPA [Air Line Pilots Association] contracts at two major carriers already address the operation of larger [greater than 70-seat] regional jets," says Merrill Lynch analyst Mike Linenberg. US Airways pilots allow the operation of up to 60 E-190s, limited to 97 seats. Delta allows its independent regional partners to operate jets up to 97 seats on behalf of other carriers.
"So it would seem that, based on the language in both the US Airways and Delta pilot contracts, ALPA is at least willing to concede on the larger RJ issue if it means an overall improvement in the financial health of the mainline carrier," says Linenberg.
Manufacturers hope to capitalise on a US market more favourable to the largest of regional jets. Embraer's 108- to 118-seat E-195 made its maiden flight in December and is expected to be certified in the second quarter of next year.
Bombardier has authority to offer its CSeries, which the manufacturer classifies not as a "regional" jet but as a narrowbody replacement aircraft, in 110- and 130-seat configurations for entry into service in 2010.
Of the 5,800 deliveries forecast in the 100- to 150-seat market over the next 20 years, Bombardier expects to capture half, or 2,900 aircraft. Its target customers are not regional airlines, but mainline carriers and leasing companies looking to replace aging BAe 146s, Boeing 737 Classics and MD-80s, Fokker 100s and McDonnell Douglas DC-9s. "It is a segment of the market that, by and large, has been neglected by Boeing and Airbus," the company says.
Regional Airline Association president Debbie McElroy believes the industry will welcome such large aircraft if market conditions permit. "The regional airline industry would like to operate more larger aircraft," she says. "It's unfortunate that scope-clause restriction in some of the major airlines' pilot agreements prevent the matching of the appropriate size aircraft to the markets."
Source: Flight International
