March 8, 2016, © Leeham Co.: Pratt & Whitney’s Geared Turbo Fan technology was what prompted a used airplane lessor to place its first new airplane order,
selecting the Mitsubishi MRJ90 in the process.
Jep Thornton is a partner with the small lessor Aerolease, a 20-year old company that has up to now concentrated on acquiring McDonnell Douglas DC-8s, Airbus A300s and Boeing 757s for conversion to cargo aircraft. Aerolease has about 40 aircraft under management and ownership.
Thornton and Mitsubishi announced at the Singapore Air Show last month a Letter of Intent to order for 10 MRJ90s and options for 10 more. Deliveries begin in three years.
“What happened on the MRJ is we became aware primarily by virtue of the Pratt Geared Turbo Fan,” Thornton told LNC in an interview during the annual ISTAT Americas conference last week in Phoenix (AZ). “We like that technology. We think that’s cool stuff. We looked at the [Bombardier] C Series way back. It was just too early [then] on a number of levels.
“I spent a lot of time in Hartford (PW’s home) and spent a lot of time looking at the geared turbo fan technology. We loved it. The MRJ has the geared turbo fan; that
was our focus,” he said. “Then we began looking at the MRJ. We looked at it in the context of two things. One, Mitsubishi is obviously a very strong, financially capable company. Secondly, they designed and built the 787 wing. They build the 777 parts. They clearly have the capability of designing aerodynamic structures. We love the engine. The Rockwell avionics are amazing.
“Lastly, we never saw ourselves as a new aircraft lessor, but nobody was ordering the airplane. We started talking to them seriously, and they responded. It wasn’t ‘get in line, take a number.’”
Thornton said Aerolease will be an “ambassador” for the aircraft, “a Western ambassador that understands marketing and understands technical and has a good relationship with Pratt & Whitney.”
There are more than 200 firm orders for the airplane, but more than half are from the USA’s SkyWest Airlines and Trans States Airlines. Because the US labor contracts between the pilots and the mainline carriers for whom these two carriers fly have Scope Clauses restricting the size of the airplanes, the ability of the MRJ90 to operate under these restrictions remains in doubt. The MRJ90 exceeds the weight limits currently in the contracts.
“The United States is not a market for our aircraft,” Thornton said. “We are not focusing on the United States at all because of that. There’s interest in this aircraft.”
The order represents a major change from Aerolease’s historical strategy.
Aircraft age has definitely become an issue with operators. The Middle of the Market aircraft with scaled geared turbo fan motors would be a killer aircraft for me.
“We have been evaluating several different strategies to accent the 757 strategy. We’ve been a bit of a one-trick pony for six years now. That’s kind of how we’ve been operating all the way back to 1988, with the DC-8 then the A300 and now the 757.
We’ve looked at a lot of things. We’ve looked at Airbus A321 conversions, which we still might do. We looked at getting involved in the [Boeing 737] 800 conversion business.
“I’d love to be the launch customer of the MOM,” Thornton said. “A single aisle 757 with the higher gear. Clearly the 737-9 is not the MOM.”
Hope this works, that a sum up of strong OEM, engines and systems creates the market opportunity. It didn’t work out so far for MBD sofar and Embraer is the market leader with the same engines and proven airframe and world wide support network. Strategy should be to create new markets region by region.
Good to see the explanation of that order and what the strategy is going forward with it.
Most interesting.
Not an understatement that the 737-9 is not a MOM, the A321NEO or not is not either but its closer.
Trouble is ‘the explanation’ is totally in reverse of common business practice.
Everyone else has customers who are looking to lease new planes at about the same capacity, so they look at manufacturers who give the best deal.
What has been described is how people buy a house at the beach.
Love the house and its eco design, love the view, love the quality and builders reputation, when can I move in.
Im asking who is providing the funding for this company to pay for these planes and Im thinking Bank of T0kyo- Mitsubishi!
Surprise! they have an aircraft lease subsidiary too
BTMU Capital Corporation
Good points from Aerolease, but I would be more interested in understanding why they chose the MRJ-90 over the slightly larger E2-190 or CS100.
Price, I think. Or more precisely, the MRJ-90 has the breeding of a better than average plane that will be sold to Aerolease at a below average price. Mitsubishi have the deep pockets to support Aerolease in creating a market for the MRJ-90. So Aerolease make a relatively low risk commitment. That seems to be what Jep Thornton is hinting at.
As an intermediary, Aerolease make their money from the difference between what they pay for the planes and the rates they lease them at.
@BernardP: Thornton said no E2s available in a reasonable time. He also said Mitsubishi is a financially stable, strong company. From that you can infer the answer to your other question.
“Secondly, they designed and built the 787 wing” Did Mitsubishi actually design the 787 wing? I thought Boeing simply outsourced its manufacture.
I believe the statement above is correct for the most part.
I think on the component level it was a collaboration of what they could do vs engineering (as always) and they worked it out.
I always was shocked that Boeing would allow its wing technology out of its own factory.
When you see what they did with the cranked wing vs the winglets Airbus is just starting to use, you can see how far ahead Boeing is in that area.
That would be an interesting area to hear from Bjorn on.
Are you talking about Aviation Partner’s winglet/scimitar designs?
Boeing’s basic wing technology is so good that they are strongly dependent on pimping aero performance via expensive wingtip devices 🙂
Oh come on. Airbus is the poster child for me too wing tip devices. They can’t even come up with their own they have to steal someone else intellectual property not to mention silly names.
Of course Boeing added them on, its all about completion and Airbus followed. .
You will note that all new designs, 787, 777 current and future, 747 all with new wings have a in wing design that matches or exceeds the winglets that Airbus is now copying. (grin)
Afaik the APB patent was voided as it tried to homestead public domain information.
So much for copying IP.
Stealing form the commons is established MoO on the B side of things.
I know I am repeating myself but I thought it was a complete confirmation of the GTF when all the NASA studies for near future (2020-2022) in order to meet the needs for a significant improvement in fuel economy all were GTF based.
Next generation will be more refined and P&W is to be congratulated for sticking with it.
If its a one only in a decade due to its complexity, having the early work to build in can be a huge advantage for the first mover if they keep their nose to the grindstone.
GE and RR can copy it, but they don’t have the experience with working with it until they get their own versions out. GE is going to have to do something fairly soon I would think.
If not, while it would take a long time, they could put themselves in P&W previous and still current position.
Most interesting would be to see P&W beat out the A380NEO if that ever comes to light of day.
Boeing design the 787 wing, gave the blueprint to mitsu together with engineering support. My cousin was station with mitsu.
So the side of body join issue was completely home made?
The wing join design issue was a desperate result to shave weight. It was fine to start with, they cut it back to where it failed the 150% performance test (somewhat less but close enough). One of those not really an issue but does not meet spec and had to be corrected.
Probably Boeing directive. Bad move. One of many at the time. So it goes.
Some operation have problems with wiring and some with wing rib feet and usually they work it out.
Mitsubishi only got the 787 wing contract because they are highly subsidised by the Japanese government. So it was a way of offloading a big chunk of startup costs to somewhere- anywhere.
Naturally they could do the work, after installing the high tech equipment mostly paid for by the Japanese taxpayers, and Boeing helping them every step of the way.
Yea and the point is?
Britains wing plant for Airubs highly subvisied, as are varous improvments in Euyrope.
Boeing gets huge discount on taxes to ship jobs out fo Wahsignon state.
So it goes.
Sure did not work out well for Boeing but for the most part the Japanese contracts seem to have held up fine (I doubt they made the wing joint decision debacle).
Battery, hmm, not so much. Flip side of Japan, filthy manufacturing plant that you would not make cheap pots in but ……