With many different indigenous aircraft manufacturers, the airlines of the Commonwealth of Independent States (CIS) had—historically—plenty of choice when it came to selecting their fleet options. While many of those aircraft are still flying, modern types being produced in the CIS member states (Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Armenia, Moldova, Russia, Tajikistan, Uzbekistan and associate member Turkmenistan) are much fewer. The Sukhoi Superjet 100 (SSJ100), which has been in service since 2011, and the Irkut MC-21, currently in flight testing, are the two programs leading the way. 

Airbus and Boeing have unsurprisingly led the imports used by CIS airlines. Crossover narrowbody jets from outside these countries have been few and far between. At home, the SSJ100 has had some success, with more than 100 of the 141 delivered going to CIS operators or lessors. 

“Russia has solid potential both for the development of the domestic and international air service with neighboring countries. Taking into consideration the ‘waking up’ of business activity with Asian countries including China and [South] Korea and traditional connections with Central Asia, the crossover narrowbody jet [SSJ100] may become a good instrument for the airlines to operate these routes,” declares the Sukhoi Civil Aircraft Co. (SCAC) press office. “For example, passenger traffic from/to/via Vladivostok, [Russia], in 2017 increased by 65.8% on international routes, with China, South Korea and Japan becoming the key destinations.” Having the SSJ100 has clearly helped develop these regional international services. 

Martyn Holmes, vice-president-Europe, Russia and Central Asia at Embraer Commercial Aviation, notes that the company has around 60 E-Jets flying for eight operators in seven CIS countries. “These figures are likely to increase during the course of 2019,” he indicates. “Also, the second operator to receive the E-Jet E2 is in this region, namely Air Astana. 

“The geography and demographics of the CIS work very much in our favor: Population density is generally low, with limited ground infrastructure; most city pairs are better-suited to jets in our segment, and indeed, the Russian government is encouraging improved regional connectivity, as today there is too much centralization around Moscow and St. Petersburg,” says Holmes. 

“Over the next 20 years, we foresee a requirement [in these markets] of close to 900 new jets [of] up to 150 seats, based on the observation that in the long run, the market will always gravitate toward the most efficient, rightsized and profitable aircraft,” he says. 

Mitsubishi Aircraft Corp.’s vice president of sales and marketing, Jorge Abando, says that “without assuming any artificial or political economic barriers,” the company forecasts 226 units to be delivered in the 70-100-seat market (the market its products cover while it mulls a stretch version of the MRJ) in the CIS over the next 20 years. “This is on the back of a 3.8% [compound annual growth rate [CAGR] in [revenue passenger kilometers], compared to a world average of 4.3% CAGR,” he says. 

“On the capacity side we’ve seen some of the largest [available seat kilometer] growth rates over the past 10-12 years for narrowbodies and modest growth rates for sub-100 seat aircraft,” Abando says. “This suggests rightsizing opportunities where [such aircraft] can play a larger role in new route development and building hub connectivity.” 

Crossover narrowbody jet OEMs are looking to place aircraft with operators of all business models, from low-cost to hybrid to full service. Although low-fare airlines in the CIS are not plentiful, Abando is certainly convinced that sales can be made to these and the other types of carrier. 

“The passenger demand spectrum for origin and destination markets is continuous. Markets exist for 70-100-seat aircraft to primarily develop new route opportunities and build hub connectivity. New clean-sheet designs provide the step change in operating cost structure that will benefit both the traditional airline business model and give low-fare airlines a competitive edge in markets where demand can be better matched with [smaller] jets,” he says. 

SCAC’s press office says the low-cost model is “the most efficient in the segment operating medium-distance routes taken by the narrowbody aircraft.”It notes how increases in profit and the cutting of costs (attributable to fare variations, more seats in the aircraft and increased utilization) are “the main trends of the modern passenger market.”

According to Holmes, “Crossover narrowbody jets are the most versatile aircraft in the market. As an example, each E-Jet E1 variant entered service with a different kind of operator, from mainline carrier, feeder, [low-cost carrier (LCC)] or independent regional,” he says. 

“In the coming years, the limitations of operating a ‘monofleet’—rigidly sticking to one aircraft type—will become more apparent. In fact, such is the risk of deploying a large narrowbody on a new, immature market that the most common strategy is to begin with 1-3 weekly frequencies,” Holmes. “In many cases, this level of service does not make the route viable, and so, as quickly as it was added, the route gets dropped. Last year alone, Europe’s LCCs canceled more markets than they opened. 

“The E-Jet E2 family is better-geared to launching new markets with a higher frequency, or even working in tandem with larger narrowbodies on denser markets where not every time slot justifies a larger aircraft,” Holmes says. “So long as each fleet has enough critical mass to earn its keep, and the network planners deploy it efficiently, an optimized fleet can trump a rationalized one.” 

Embraer and Mitsubishi, of course, have the challenge of selling into the biggest CIS country, Russia. Both are aware political issues may arise that affect sales, but both are equally confident the market will prevail. 

“Embraer will continue to fight for a level, unrestricted playing field, where the market decides and aircraft selection is made purely on the commercial and technical attractiveness of the aircraft. We are market leaders up to 150 seats, and have no intention of relenting in our quest for a market without frontiers,” says Holmes. 

Abando says Mitsubishi would not want to make any predictions on what political issues may affect sales opportunities in Russia directly. 

“However, as we all know, import customs duties or value-added tax are factored into aircraft acquisition decisions, especially those as high as 20%. Despite existing loopholes and exemptions, any news suggesting [their removal seems] to primarily be based on lost tax revenue rather than any rise in protectionism,” Abando says.