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The Hidden Aircraft Market in "Plane" Sight

There are currently thousands of regional jets flying right now, including over 1500 in the United States alone [1]. These include the Embraer ERJ Series, the Embraer E-Jets, and the Bombardier CRJ Series. Many of these jets, particularly the 50-seaters, are being retired at a rapid pace as they grow in age. There are a few projects that appear to be viable replacements for these aircraft, but there are caveats to each of them. In this article, I will be focusing on how these projects fail to adequately replace US regional carriers' aircraft, which leads to a huge opportunity for manufacturers to launch a new regional jet.

Embraer E-Jet E2 Series

Specifically, the E175 E2

This is Embraer's direct successor to the E175, which has proven immensely popular among regional carriers. Embraer also has two stretched models, the E190 E2 and the E195 E2, but since they are designed to carry over 100 passengers, they fall outside of the "regional jet" category. However, the E175 E2 has received no orders, in contrast to its larger siblings. This can be explained by one simple reason - US regional carriers are unable to operate it. The reason for this lies in the scope clauses that limit the size and amount of regional aircraft that carriers can operate. These clauses exist in order to protect mainline carriers from having too many of their pilots outsourced by their regional partner airlines. One of the rules of these clauses is that regional aircraft cannot have a maximum takeoff weight of more than 86,000 lbs [2]. The original E175 fits within this limitation, but the E175 E2's MTOW of 98,120 lbs puts it outside of these limits [3].

Bombardier CRJ-550

One of the other limitations of the scope clause involves how many aircraft of a certain seat amount can be operated. In United's case, the airline is limited to operating 255 aircraft with 51-76 seats, and the rest must have 50 seats or less [4]. In order to operate more regional jets, United decided to reconfigure some of its CRJ-700s (70 seaters) to a more premium-heavy configuration with 50 seats [4]. While this could be seen as a "replacement" to older 50-seat aircraft, there are two reasons why this does not work. First, the premium-heavy cabin of the CRJ-550 is only suitable for business-oriented regional routes, meaning it cannot be profitably used on all 50-seat routes. Second, the 550 is not a new aircraft type, but a reconfigured old one, meaning it does not possess the latest technologies and efficiencies of a next-generation aircraft.

Mitsubishi SpaceJet (Formerly the MRJ Series)

Japan's first commercial aircraft in over half a century appears to be a viable replacement for older 76-seat regional jets. By lowering the passenger density slightly and reducing its fuel capacity, the M100 (the smaller model) can achieve an 86,000 lb takeoff weight, putting it within the limits of US scope clauses [5]. However, Mitsubishi has experienced a multitude of delays in the aircraft's development, eventually halting the program altogether [6]. Due to the COVID-19 pandemic's reduction in aircraft demand, it is possible that the program may be scrapped altogether, leaving airlines that had ordered the aircraft without any replacements for their older planes.

The Bottom Line

The E175 E2 and the SpaceJet may be new and efficient, but the MTOW of the E2 and the uncertainty of the SpaceJet's development mean there is no definitive replacement for 76-seat regional jets. Meanwhile, there are no replacements for 50-seat regional jets, as the CRJ-550 is not a new aircraft. The COVID-19 pandemic may have reduced aircraft demand over the next few years, but looking at the long-term future, there will be a huge need to replace the hundreds of regional jets currently flying in the United States. Delta Connection, American Eagle, and United Express all have average fleet ages in the double digits, and their 50-seaters are approaching 20 years in average age [7][8][9]. Since most aircraft are retired before they reach 30 years old, the demand to replace these will surge around the end of this decade, once the COVID pandemic has subsided [10]. As mentioned before, 50 seaters are being retired even sooner, with Delta phasing out its CRJ-200s by 2023 and American having already phased out its CRJ-200s and ERJ-140s [11][12][13].

These retirements give a huge opportunity for manufacturers to create a new regional jet to replace these aircraft. For example, the ERJ series could be re-engined to replace the 50-seaters, and the CRJ could be re-engined to replace the 51-76 seaters. Whoever steps up to the plate remains to be seen.


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