The novel coronavirus pandemic has hit the global aviation industry the hardest with demand for air travel past historic lows. Airlines are struggling to cope up with the decline in air travel which in turn has affected the other industries in the aviation sector.
A reflection of this as seen in Japan where the plans for building of the country’s first indigenously designed passenger plane in more than five decades have been put on hold because of the dire state of the industry.
Budget for the project is being significantly trimmed down by Mitsubishi Heavy Industries, the company behind the new SpaceJet.
The project is already running well behind schedule as six delivery deadlines, with thee first miss in 2013, have been missed by the Mitsubishi SpaceJet.
The coronavirus pandemic has also forced the suspension of test flights in the United States.
The company will be freezing development of its SpaceJet regional jet and divert the funds to other parts of its business, Mitsubishi Heavy Industries said on Friday.
The company reported a 62.5 per cent drop in its operating profit in the second quarter. The company said that it will be able to lower costs by 120bn yen by the suspension of the SpaceJet project.
The downturn in the airline industry brought on by coronavirus travel curbs as th main rason for the decision to cut back on funding for the project.
Airlines around the world have been forced to shrink operations to survive.
Even though government travel subsidies in Japan has helped in a partial rebound in in domestic demand for air travel, demand for international travel is still miniscule compared to what it was prior to the pandemic.
The new plane’s first customer would have been Japan’s biggest carrier ANA Holdings.
Mitsubishi Heavy Industries is one of the most important suppliers of components to the global air plane making giants Boeing and Airbus who dominate the global industry.
The efforts of thee Japans government to establish the country as a global commercial plane maker had prompted it to encourage the development of the SpaceJet programme.
“Airbus and Boeing have global reach. This is critical in terms of after sales service and maintenance support,” said airline industry consultant John Strickland.
“It’s difficult for others to attempt to replicate this.”
The Chinese government also has lofty ambitions for making it big in the global airplane making industry and is going ahead in this field with is plane maker Commercial Aircraft Corporation of China (Comac).
(Adapted from BBC.com)