Commercial Aircraft of China’s (COMAC) first aircraft, the ARJ21, is reportedly facing delays due to design flaws (Reuters, 08-Jun-2012). The aircraft, which is designed to compete with Bombardier and Embraer, has reportedly been faced with flaws in its wings, wiring and computer systems. Meanwhile COMAC plans to commence deliveries of its C919 by 2016 which is to compete with the A320 and Boeing 737.
COMAC’s ARJ21 reportedly facing delays due to design flaws
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Bombardier C Series: record orders in 2016 as both variants finally enter service
The first commercial flight of the Bombardier CS300 on 14-Dec-2016, operated by airBaltic from Riga to Amsterdam, will be a major milestone for the Canadian manufacturer's new C Series aircraft programme. Three CS100 aircraft are already in service with SWISS, so the airBaltic flight will mean that both variants of the C Series are finally in commercial operation.
The programme is Bombardier's first wholly new aircraft development, aimed at the 100 to 150-seat market segment and offering advantages of fuel efficiency, cabin space, noise and emissions. Bombardier once targeted 2013 for entry into service, but has been dogged by problems and delays. In 2015, Bombardier seemed to have overstretched itself. The C Series received no new orders during the year and Bombardier was forced to seek investment from the Province of Québec to rescue the programme.
In 2016 the company has recovered to win a net 117 new orders, its highest annual total, bringing the programme total to 360. However, competition is cut-throat, with Airbus, Boeing and Embraer all having new developments of existing products in the same space as the C Series. Bombardier's breakthrough orders from Air Canada and Delta in 2016 required heavy price discounts.
WestJet positive about its revenue performance as it works to shore up falling returns
Canada’s WestJet is maintaining a reasonable level of confidence that its unit revenue growth will outpace cost inflation in early 2017, as it attains positive unit revenue in 1Q2017 for the first time in eight quarters. Improving conditions in the province of Alberta and growing ancillary revenue are helping to lift WestJet’s unit revenues in early 2017.
WestJet’s return on invested capital has been falling during the last few months, dropping out of its targeted range of 13% to 16%. The airline is not offering a specific timeframe to post an improved ROIC performance, but believes a better operating environment in Alberta should create a favourable scenario to attain targeted return levels.
After WestJet’s pilots endorsed a new deal in late 2016 that allows for the expansion of the airline’s widebody operations, speculation grew about a potential aircraft order from the company in the not too distant future. But WestJet is taking a cautious approach to its widebody evaluations, as current capital expenditures could reach CAD920 million (USD703 million) in 2017 and investors are looking for definitive progress in restoring historical ROIC performance.