Big Chinese airline groups may pose problem for ARJ21

Kunpeng Airlines is to be the first to fly China's new regional jet, the ARJ21, rather than Shandong Airlines.

I was able to confirm this story today by speaking to a senior source at Kunpeng's parent Shenzhen Airlines and by speaking to a source at Shandong Airlines.

The source at Shandong says the airline put in the request to the manufacturer to no longer be the launch operator and that the airline's decision to do this came after it underwent a management change.

When Shandong Airlines ordered 10 ARJ21s in 2003 it, could be argued, the airline was more independent than it is now.

Since then it has increasingly come under the control of Air China

In 2003, Shanghai Airlines also became a launch customer with an order for five ARJ21s.

But its future as an independent player may also be numbered because the owners of Shanghai Airlines and China Eastern Airlines have been speaking about merging the two loss-making carriers.

China's Government has also told China Eastern to do whatever it takes to become profitable. That means if China Eastern does merge with the much smaller Shanghai Airlines then it has an avenue to argue that delivery of ARJ21s to China Eastern/Shanghai Airlines group should be delayed.