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By Scott Hamilton

Analysis

May 25, 2020, © Leeham News: Mitsubishi Heavy Industries (MHI) surprising retreat from its SpaceJet regional airliner program is the best news in months for beleaguered Embraer.

This takes pressure off the Brazilian manufacturer and gives it time to regroup after Boeing jilted it at the alter by walking away from a proposed joint venture.

Going into storage: four Mitsubishi MRJ90s at Moses Lake (WA). Photo: Mitsubishi.

MHI’s actions leave Embraer with a monopoly in the 76-100 seat arena vs new airplanes. The M90 SpaceJet is not a viable competitor to the E175-E1 or the struggling E175-E2. Embraer’s competition will be its own used jets, plus used Bombardier CRJ-700/900s.

Summary

• Closing US operations entirely. Closing the recently opened engineering center in Montreal
• Continued operation of the CRJ product support center in Montreal or relocation to Nagoya uncertain.
• Major cost-cutting drive.
• MHI wants to certify M90, then consider whether to proceed with M100.
• M100 has MOUs for 495 aircraft.
• MRJ90 was not certifiable due to design deficiencies.
• Redesigned M90 meets certification requirements.
• M90 is economically uncompetitive with E-Jet.
• COVID-19 upends entire airline industry, casting doubt in MHI’s commitment to SpaceJet future.