SpaceJet Is Mitsubishi's Newly Renamed Regional Airliner

(Bloomberg) -- The SpaceJet is not going to take you to the moon or Mars, but it can get you to a smaller city on earth without having to switch flights in Atlanta, Dubai or another big airport hub.

The newly renamed regional jet by Mitsubishi Heavy Industries Ltd. is being showcased at the Paris Air Show next week, along with a new model that can seat 76 passengers. The Japanese manufacturer is using the industry gathering to go on a marketing blitz after the airplane suffered multiple delays and setbacks.

The SpaceJet is the first airliner built in Japan since the 1960s. Mitsubishi Heavy, a longtime supplier to Boeing Co., is betting the timing is ripe for a new regional plane as more cities across the globe seek to link up with each other. The duopoly of Bombardier Inc. and Embraer SA, which has long dominated the market for regional commercial jets, is looking at other segments.

“The reaction has been very positive,” said Alex Bellamy, the SpaceJet’s chief development officer at Mitsubishi Aircraft Corp., the company’s airliner segment.

The SpaceJet program and details of the new plane will be previewed at the airshow at Le Bourget, just outside the French capital. The second 76-passenger jet will be called the SpaceJet 100, or the M100, with deliveries scheduled to begin as early as 2023, Bellamy said.

Mitsubishi Heavy is negotiating with a number of different customers for the jet, Bellamy said in an interview. Interest in the new plane has been high among clients in the U.S. and Europe, he added, but declined to say when he expects to see orders. The M100’s size will comply with agreements in the U.S. between airlines and pilots regulating the passenger load for planes that can fly on routes outsourced to smaller carriers.

Airlines worldwide will need more than 5,100 regional jets over the next two decades, Mitsubishi predicts. The Japanese manufacturer also appears to be ready to double down on the segment, after disclosing earlier this month that it’s in discussions to acquire Bombardier’s CRJ regional jet program. Bellamy declined to comment on the deal.

Mitsubishi’s 88-passenger plane, formerly called the MRJ90, will be renamed the M90 and is still on schedule to see its first delivery in mid-2020, according to Bellamy.

Mitsubishi has spent at least $2 billion over more than a decade on developing its aircraft business, which has been beset by delays because of production difficulties. The company had initially planned test flights in 2012, but only began certification flights in the U.S. earlier this year.

The SpaceJet is named to indicate the spaciousness of its cabin, according to Bellamy. He anticipates the new airplane will be 10% cheaper to operate due to its fuel savings from the lighter weight, and longer intervals between maintenance. Depending on demand, some of the production of the planes may be moved to local areas such as the U.S., Bellamy said.

Although Mitsubishi is focused on getting the M90 and M100 to market, Mitsubishi Heavy is thinking about adding another model to the lineup, he said. “There is a possibility, a likely possibility, that we would look to finish off our family with an aircraft that goes up to 100 seats.”

--With assistance from Bruce Einhorn.

To contact the reporters on this story: Lisa Du in Tokyo at ldu31@bloomberg.net;Masatsugu Horie in Tokyo at mhorie3@bloomberg.net

To contact the editors responsible for this story: Rachel Chang at wchang98@bloomberg.net, Reed Stevenson, Ville Heiskanen

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