Toyota asked to invest in new jet
TOKYO–Japan’s top automaker Toyota said Wednesday it has been asked to invest in a project to build the first "made in Japan" passenger aircraft in three decades.
The Asahi newspaper reported Wednesday that Toyota Motor Corp. plans to invest about 10 billion yen (US$96.7 million) in the project by Mitsubishi Heavy Industries. Toyota spokesman Paul Nolasco said a decision has not yet been made.
Mitsubishi, based in Tokyo, said it was in talks with various companies but declined to give their names. It said a company to run the project’s business would be set up this spring.
The Asahi said Mitsubishi will take a 60 per cent stake in the company, capitalized at about 100 billion yen ($966.7 million).
Toyota rival Honda Motor Co. has already entered the jet business, making small jets for up to eight passengers. Tokyo-based Honda began sales of its jet in 2006 and has orders for more than 100, with first deliveries set for 2010.
The Mitsubishi Regional Jet is to be a twin-engine aircraft seating about 70 to 90 people. The lightweight carbon-fibre composite jet is designed to consume about 20 per cent less fuel than comparable standard jets.
Demand for smaller jets is expected to rise over the next 20 years in regional markets. Mitsubishi’s main target markets are North America, Europe and Japan.
The jet would likely compete against midsize jet makers Montreal-based Bombardier Inc credit reports. (TSX: BBD.B) and Brazil’s Embraer SA, as well as companies in China and Russia that are developing regional jets.
Mitsubishi – part of a major Japanese conglomerate that includes an automaker, electronics maker and trading company – has chosen Pratt & Whitney, a unit of United Technologies Corp., as the MRJ’s engine supplier.
Last month, Mitsubishi said it has picked three U.S. businesses and two companies from Japan to supply other major parts.
Parker Aerospace, based in Irvine, Calif., will be developing the hydraulic system; Hamilton Sundstrand Corp., another unit of Hartford, Conn.-based United Technologies, will supply electrical power and air management systems, an auxiliary power unit and other key systems; and Rockwell Collins Inc., based in Cedar Rapids, Iowa, will produce a flight control system.
Tokyo-based Nabtesco Corp. will work with Rockwell Collins on the flight control system, and Sumitomo Precision Products Co. will produce landing gear, according to Mitsubishi.
Mitsubishi, long a major supplier for Boeing Co. of the U.S., has already begun marketing the MRJ worldwide. First deliveries are set for 2012.
Bombardier shares were trading up two cents on Tuesday on the Toronto Stock Exchange at $5.50.