Mitsubishi Aircraft’s parent company will review the development of a 76-seater variant of its regional jet programme nearly a year after its launch, as full-year losses related to the programme widened.
Mitsubishi Heavy Industries (MHI) will also halve the budget allocated for the SpaceJet regional aircraft programme to Y60 billion ($558 million) for the year ending 31 March 2021.
In its full-year results presentation, MHI states that it is “setting an appropriate level of budget” for the SpaceJet programme in the new financial year.
The final budget of Y60 billion takes into account impairment losses from the acquisition of Bombardier’s CRJ programme, which amount to between Y50 and 70 billion. The deal, announced in June last year, will close by 1 June this year.
On the M100’s development progress, MHI tells FlightGlobal: “While we evaluate the state of global aviation, it has been determined to reconsider the process of the SpaceJet M100 feasibility study.”
The Japanese firm adds that it “remains committed” to move the development of the baseline, 90-seater M90 variant forward.
The SpaceJet M100 was launched at the Paris air show in 2019 and is targeted at the USA regional market. It was designed to meet take-off weight limits for 76-seat aircraft as stipulated by major US airlines’ pilot contracts.
Mitsubishi has already seen the M90’s service entry timeline move further to the right. At present, the first M90 will be delivered to launch customer All Nippon Airways by April 2021, or later.
MHI says that the coronavirus impact, which hit the company from March, forced it to suspend type certification test flights at its Moses Lake facility in the US. The ferry flight for M90 Flight Test Vehicle 10 (FTV10) — the first example of the M90 produced in what the company calls its “new, certifiable baseline design” — to the US also had to be delayed as a result of the outbreak.
SpaceJet-related losses for the year ended 31 March widened to Y263.3 billion, more than triple the Y85.1 billion loss it incurred the previous year.
MHI’s aircraft, defence and space unit, in which the SpaceJet programme resides, saw its full-year operating loss increase to Y209 billion from a Y37.4 billion loss reported the previous year.
Revenue for the unit went up about 4% to Y705 billion, on the back of increased takings from defence aircraft and missile systems.
The unit’s overall order value for the period increased 17.8% to Y719 billion, also due to its space systems, defence aircraft and missile systems portfolios.
As a result of losses from the SpaceJet programme, MHI plunged into the red for its full-year results, reporting an operating loss of Y29.5 billion. This contrasts with the Y186.7 billion profit it made the previous fiscal year.
On the “changing business landscape”, MHI has flagged “significant” near-term impact on its commercial aircraft and engines business, due to the coronavirus outbreak.
It notes that while Boeing — for which MHI is a tier one supplier — has resumed production of aircraft following factory closures to mitigate the pandemic’s spread, but “uncertainty surrounds production rates”.
Given that MHI is a key supplier to Boeing’s widebody programmes it expects a protracted downturn.
On the aero engines side of business, MHI says: “Reduced flight levels have impacted service business [which are] a key revenue stream.”