Indonesian airline will be first to fly fleet entirely of ARJ21s

Comac signs 60-jet deal with Hong Kong leasing group, worth up to US$2.3 billion — largest single order yet for the Chinese-built airliner

PUBLISHED : Tuesday, 12 July, 2016, 8:36pm
UPDATED : Tuesday, 12 July, 2016, 11:00pm

An Indonesian airline is to become the world’s first to operate a fleet made up entirely of Chinese-built jets.

Hong Kong-listed China Aircraft Leasing Group has confirmed that it and its substantial shareholder Friedmann Pacific Asset Management will buy 30 ARJ21-700 jets with an option to buy 30 more, from state-owned Commercial Aircraft Corp of China, or Comac.

The US$2.3 billion deal was signed on Monday at the Farnborough International Airshow in England, Comac confirmed.

Friedmann Pacific is owned by China Aircraft Leasing’s former chief executive and second-largest shareholder Mike Poon.

It plans to invest in an Indonesian airline that will rent the planes for what will be an all-ARJ21 fleet, according to the companies, although they declined to name the airline.

The signing marks the biggest single order for the Chinese homegrown jet. The 90-seater aircraft only entered commercial service domestically late last month after repeated delays, and is still to be certified by the US’s Federal Aviation Administration, meaning it cannot fly in most international skies that base their entry requirements on the US certification.

The statement said Friedmann Pacific will assist Comac in obtaining the relevant validation so the aircraft can be operated in Indonesia.

Comac also announced at the show that it had received an order for 30 ARJ21s from state-owned Avic Leasing.

This is far from the blue chip customer, and vote of confidence the airframer is looking to secure
Will Horton, a senior analyst with Hong Kong’s Centre for Aviation

The company’s larger product, the C919 — which it is hoped will challenge the Airbus A320 and Boeing B737 duopoly — remains years behind schedule, and has yet to make its maiden flight.

China Aircraft Leasing Group also signed up previously for 20 C919s.

Industry experts said operating an entire fleet of ARJ21s presents considerable commercial and operational challenges, most pointedly, in Comac’s ability to provide full customer support for the first time.

“This is far from the blue chip customer, and vote of confidence the airframer is looking to secure,” said Will Horton, a senior analyst with Hong Kong’s Centre for Aviation.

“There is some risk that this order reinforces the view that the ARJ21 is for tertiary airlines.

“Besides the usual concerns, are questions about its service support, which was lacking on the MA60 programme,” he said, referring to the earlier Chinese-made twin-turboprop passenger model that had frequent safety problems.

“This could be some indication, too, for the C919. It is one thing to build an aircraft. It is another to support it through its decades-long service life.”

Chengdu Airlines, the ARJ21’s launch customer in China and a Comac subsidiary, spent seven months testing the model and training its crew after taking delivery of it last November.