ANALYSIS: Can the CSeries crack the Asian market?

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Bombardier is confident that it will see more orders for the CSeries now that the type has made its first flight, but how many of those orders are likely to come from Asia?

To date, there has only been a small flash of interest in the type from an Asian carrier. It came from AirAsia chief executive Tony Fernandes at the 2012 Farnborough air show. At that time, both Fernandes and Bombardier talked up the prospect of the low-cost carrier launching a high-density, 160-seat version of the CS300, with an order for 100. The logic at the time was that the aircraft could be used at airports around Asia that could not technically or commercially support its 180-seat Airbus A320s.

Those hopes were dashed a few months later when AirAsia placed a mammoth order for the A320neo, making the whole episode seem like it was more of a negotiating tactic to get Airbus to sharpen the pencil on its pricing for the re-engined aircraft.

Nevertheless, Flightglobal Ascend senior consultant Rob Morris says that Asia will be a significant market for the CSeries. The latest Flightglobal Fleet Forecast shows that Asia-Pacific will account for 35% of the type’s total sales over the next 20 years.

“The majority of these 650 or so deliveries are expected to be the larger CS300 variant, which will offer similar capacity to the smaller variants of the A320 and [Boeing] 737NG family but superior economics,” he says.

Flightglobal Ascend Online Fleets data shows that in the region, there are currently more than 870 passenger aircraft with 90-150 seats in operation. More than half of those are 737-700s and A319s, of which most are in operation with Chinese carriers such as Air China and China Eastern Airlines.

Although those carriers are expected to be significant customers for the A320neo and 737 Max, Morris notes that the alliance between Bombardier and Comac could open the door for Bombardier to better market the type in China.

He adds that although there will be many more A320neos and 737 Maxes delivered, “there remains a significant niche opportunity for CSeries in the region”.

“As an optimised aircraft, CSeries appears to offer significant seat mile benefits over even the Neo and Max's A319 and 737-7 variants,” he adds. “So for airlines with routes more suited to 100-130 seats the aircraft can offer some advantage over those types and this is where the market opportunity lies.”

Some of those opportunities will come from developing secondary networks that do not exist yet. As the larger carriers continue to spread outwards, some expect that new niches will emerge in secondary markets, and point-to-point routes across countries such as Indonesia, China and India.

Opportunity will also come from Australia, where types such as the Boeing 717 and Fokker 100 have grown in popularity over the last few years. Qantas, in particular, is expected to look at the CSeries to replace its growing fleet of 717s. Those aircraft have proven to be particularly useful on regional routes where they provide an intermediate step in capacity between its 74-seat Bombardier Dash 8 Q400s and 165-seat 737-800s.

Similarly, Virgin will likely have to decide whether to switch to the CSeries or the rival E-Jet E2 offering from Embraer. However, Morris notes that the re-engined Embraer 195 “looks competitive with CSeries”, which may make it more difficult for the Canadian manufacturer to penetrate the Australian market.

Despite the growing fleet of Fokker 100s in Australia, those aircraft are unlikely to be replaced by new aircraft such as the CSeries any time soon. Most of those aircraft are used on low-utilisation services for the resources industry, and as such, the lower operating cost of the CSeries may not be enough to offset the lower capital costs of an older type.

Although sales have yet to take off, Asia could prove to be the fertile ground needed for the CSeries to have a significant impact on the global airliner market.