SkyWest Inc.'s month-old plan to firm up its agreement in principle for 100 Mitsubishi Regional Jets (MRJs) is moving forward as planned.
"As to the [memorandum of understanding with Mitsubishi], we continue to work towards an agreement and [it] is progressing as expected," says Michael Kraupp, SkyWest's chief financial officer and treasurer.
The airline announced an agreement in principle to order 100 MRJ90s nearly a month ago at the Farnborough Air Show on 11 July. The agreement included an option to convert the some or all of the order to the MRJ70.
Mitsubishi Aircraft president Hideo Egawa told Flightglobal at the air show that he expected the agreement--worth $4.2 billion at list prices--to turn into a firm order "within a few weeks."
The agreement signals a step in a new direction for SkyWest Inc., the holding company of SkyWest Airlines and ExpressJet, because its regional carriers currently operate fleets made up of Bombardier and Embraer aircraft.
Despite this, Bombardier chief executive Pierre Beaudoin dismissed the MRJ as a major competitive threat when speaking on a webcast with market analysts today.
The MRJ is "not a significant factor at this point," Beaudoin said. He also noted that Bombardier's sales staff sees Mitsubishi "periodically" in campaigns, but they have achieved recent success only in terms of a "letter of intent" with SkyWest.
Bradford Rich, president of SkyWest, told investors during an 8 August conference call that he sees the Mitsubishi agreement as a different approach for adding aircraft to its fleet.
"We feel that's a significant transaction for both us and Mitsubishi Regional Aircraft for a number of reasons," said Rich. "For us, we believe that it's indicative of some creativity and some very hard work to create a relationship with an aircraft manufacturer that is different in many respects than the traditional way of buying and managing aircraft assets, that we believe will create some significant economic advantages," said Rich.
SkyWest Airlines expects to receive its first MRJ90 in 2017 and then take deliveries of the remaining aircraft through 2020.