Andrew Doyle/MUNICH Paul Lewis/WASHINGTON
Bombardier has signed a breakthrough deal with China's Shandong Airlines to supply five Canadair Regional Jet (CRJ) series 200s. It will also look at establishing a dedicated training centre as local interest in regional aviation picks up.
The Jinan-based provincial operator is the first Chinese carrier to acquire a 50-seat jet for scheduled services, and the deal follows Hainan Airlines' order for up 39 smaller Fairchild 328JETS. Military-run China United Airlines has five CRJ-200s for VIP transport (below).
Bombardier's deal with Shandong includes a preliminary agreement to look at building a CRJ training facility. It would be China's first regional jet centre. Airbus Industrie and Boeing have established similar joint venture training facilities in a bid to further sales of their respective aircraft.
A recent Civil Aviation Administration of China (CAAC) study forecasts a requirement for 400 regional aircraft by 2018. A similar market study by Bombardier identifies a need for between 200 and 400 over the next 20 years.
Local sources say growth will not be limited by airline demand, but by the ability of China's infrastructure to support the new aircraft and in particular its underdeveloped provincial airports. A tax of up to 10% on ticket revenue has also constrained the development of a regional aircraft network.
This is changing as the result of China's economic slowdown, with domestic traffic projected to grow by 5% rather than the forecast 20% earlier in the decade. Load factors have fallen to as low as 30%, forcing the more entrepreneurial carriers like Hainan, Sichuan and Shandong to look at smaller regional jets in place of more Boeing 737 and Airbus A320s. Fairchild director of sales Kenneth Wigmore says: "Nearly all the airlines in China are considering regional jets."
A proper hub-and-spoke type network and alliances between the larger airlines and regional carriers still need to be developed. Smaller carriers have been acquired, such as Zhejiang Airlines by China National Airlines, but this has been mainly at the CAAC's behest, to rescue ailing operators.
Hainan Airlines deputy general manager Jimmy Guo confirms that the expansion of regional services has become one of the CAAC's top priorities, as has growth in cargo flights. "The CAAC mainly encourages these two areas and that is why we got their approval [to operate 328JETs]," says Guo.
Sichuan Airlines is also known to be in talks over a 328JET deal and is believed to have requested an import licence from the Chinese Government.
The CAAC is to dispatch a delegation to Bombardier and Fairchild, and almost certainly Embraer, to evaluate regional aircraft. The Canadian manufacturer has also just sponsored a regional air transport symposium in Beijing attended by the CAAC, China Aviation Supplies and representatives from most of China's approximately 40 regional, provincial and mainline branch carriers.
Source: Flight International
