We addressed a series of questions to Mitsubishi after the recent delay news. Here is the verbatim Q&A.
Responses from Mitsubishi Aircraft Corporation: Yugo Fukuhara, Vice President and General Manager of Sales and Marketing
MITAC has taken a number of delays so far. Are there any patterns in the delays that show up as a repeat item? i.e. what I’m trying to get at is are these delays “unknown unknowns” or is there something that keeps coming up and is tough to fix?
A: There is not a pattern of delays as much as there is a focus on quality and making sure that we get this right. While we have a long history in manufacturing and developing technology for global aviation projects like the Dreamliner, this is our first commercial jet. We are integrating Japanese craftsmanship with global engineering expertise to create the most efficient, cleanest, and quietest regional jet in its class.
It is important to note that as we are developing the MRJ, we are also setting the stage for commercial aviation to become the next major industry in Japan.
The MRJ program has the backing of MHI and some of the largest companies in Japan. With this level of commitment, you can see we are focused on the success of the MRJ and commercial aviation for the long-term.
It is remarkable that MITAC hasn’t lost a customer. What do you ascribe to this loyalty?
A: We remain in close communication with our customers. I think they understand that our level of commitment to this program and industry reflects our commitment to them. They see the appeal of the MRJ and the strong impact it will have on the industry and the opportunities it will bring to their businesses.
The MRJ90 can’t fit into current scope clause. Does MITAC believe scope might expand to allow the MRJ90 by 2020? (please see the chart we developed which suggests this might be necessary)
A: It is an interesting chart. We knew early on in our planning that scope clause agreements could impact our MRJ and we planned accordingly. Since these discussions are between the pilot unions and the airlines, we don’t really comment.
However, I would like to point out two things:
- The United States is an important market for our MRJ. We say the aircraft is “Made with the USA.” Half of the MRJ is US products. We work with 17 component partners in 24 locations across the country. The U.S. is one of our major markets, but it only makes up 35% of our forecast for sales. So, for 65% of our forecast the scope clause agreements are not an issue.
- The MRJ70 is not impacted by the current scope clause agreements. Since we can’t really know when scope clause revisions will take place, our strategy is marketing the MRJ family – MRJ70 & MRJ90 – to provide flexibility to our customers. Our U.S. customers those affected by the scope clause have conversion rights to change from MRJ90 to MRJ70. We also have U.S. customers such as Eastern Air Lines or Aerolease who are not affected by the scope clause.
What has been the reaction of SkyWest and Trans States to the latest delay? Is there any good news for them from the news?
A: It’s pretty obvious that this was not the type of announcement that a customer wants to hear. However, we have been in close communication with our customers and as we explained the situation in detail, we were generally able to gain their understanding.
If these two airlines decide to renew their fleets with EMB or BBD, how can you recover these orders?
A: We have to refrain from responding since that touches on the content of the individual contracts. But again, this is one of the reasons why we are in constant close communication with our customers – to help ensure that nothing of the sort occurs.
Looking forward, does it not seem like a better idea for MITAC to consider its next model to compete with the E190-E2 rather than develop the MRJ70?
A: We developed the MRJ family to focus specifically on the 70 – 100 seat range. We see this as a very robust market. In fact, over the next 20 years our forecast sees a demand for more than 5,000 deliveries in this regional jet segment.
At present, there is no change to the timing by which MRJ70 will be introduced to the market, about one year after the MRJ90.
Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.