Mitsubishi Aircraft Wins $281 Million Order From Air Mandalay

Mitsubishi Aircraft Corp., developing Japan’s first passenger jet, won an order worth $281 million in list prices from Air Mandalay Ltd. in Myanmar, the company’s first sale in the country.

The agreement is for six MRJ90s and deliveries are due to start in 2018, Air Mandalay said in an e-mailed statement today. The airline has an option to purchase four more, according to the statement. Each aircraft costs $46.8 million in list price. Buyers usually get a discount.

The deal is the second agreed by the company, owned by Mitsubishi Heavy Industries Ltd. (7011), at the Farnborough Air Show this week and brings the total number of orders, including options, to as many as 375. Mitsubishi, which has delayed the first test flight of the aircraft three times, wants to challenge Embraer SA (EMBR3) and take half of the global market for regional aircraft over the next 20 years.

Mandalay, based in Yangon, offers flights to 15 domestic destinations in the country.

More from the Farnborough Air Show:

U.S. carrier SkyWest Inc. (SKYW) is the biggest customer for Mitsubishi so far, with an order for 200 planes, including options. Nagoya-based Mitsubishi has also won orders for 25 planes from Japan’s ANA Holdings Inc. (9202) and 100 from Trans States Airlines Inc.

The aircraft maker, which expects to start test flights next year, also announced yesterday a memorandum of understanding to sell as many as 40 regional jets to U.S. startup Eastern Air Lines Group Inc.

Mitsubishi Aircraft brought in rail project managers from parent Mitsubishi Heavy to tighten control of the development and boosted engineers on the project by 30 percent to 1,300. The jet maker last month said it had attached engines to its first flight test aircraft and is working on installing wiring and piping to the plane.

Mitsubishi announced in 2008 it would start building Japan’s first passenger jet, which has been delayed because of design changes and problems with certification. The company is building 78-and 92-seater planes.

To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net; Kyunghee Park in Singapore at kpark3@bloomberg.net

To contact the editors responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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