China is about to publish a new policy encouraging airlines to develop and operate second-tier routes. The new legislature might lead to more orders for major players in the regional jet market, including Canada’s Bombardier and Brazil’s Embraer. With stiff competition to be expected from China’s first homegrown passenger jet – COMAC’s ARJ21 – it looks like the emerging market might be tough to conquer.

Although the policy has not yet been officially published, industry sources cited by Reuters point out that newly established airlines will have to gather a fleet of no less than 25 small regional jets in order to get permission to fly larger planes.

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The first Bombardier CS300 has been recently delivered to its launch customer – Latvia’s airBaltic. The mid-range aircraft is in the same weight category as the currently in-development Embraer E190-E2 and E195-E2, all of them seating between 100 and 150 passengers. Both manufacturers quote fuel-efficiency and cost-effectiveness as their main advantages, but why would an airline (remember – no risks in aviation!) choose them over slightly larger counterparts from Airbus or Boeing? Join AeroTime to search for the answer.
 

Industry sources consider this policy as China’s way of preventing airlines from exploiting niche segments as a shortcut to the profitable major city market, serviced mostly by Airbus and Boeing aircraft. On the other hand, the updated rules might create obstacles for new airlines to grow, as commuter routes are not that profitable. Moreover, the routes overlap with those offered by the growing high-speed train network, which creates an even more competitive environment.

New legislature should provide more incentive to purchase regional jets, including the indigenous ARJ21, but also Bombardier, Sukhoi and Embraer aircraft. However, preferential treatment to homegrown technology might hinder the plans of foreign plane manufacturers to grab a large piece of the market pie. That is, of course, if the Chinese-built regional jet (boasting 400 orders) proves to be superior for domestic airlines. Delayed by almost a decade, ARJ21 had a notoriously troublesome development process, with its feasibility dubbed questionable by many analysts.

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Comac has delivered the first ARJ21-700 to launch customer Chengdu Airlines.