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Newcomers De Havilland and Mitsubishi find themselves dwarfed by their suppliers

The long-term success of the regional aviation newcomers may hinge on their ability to convince their suppliers to come along for the fight.

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Release Date
September 9, 2019
Newcomers De Havilland and Mitsubishi find themselves dwarfed by their suppliers
Nashville, Tenn. — How do you get Goliath to work with you?

Transformation was in the air here at the 2019 Regional Airline Association conference. What was an unchanging cadre of plane makers has given way to new names, resurgent players and those undergoing major strategic shifts.

But the long-term success of the regional aviation newcomers hinges not only on their ability to convince customers of the virtue of their product, but increasingly their consolidated supply chains which tower over them. Today, both Mitsubishi Aircraft Corporation (Mitac) and De Havilland Aircraft of Canada have a similar challenge as they take on Embraer (soon to be Boeing Brasil Commercial) and ATR, respectively.

The question ultimately boils down to this: Do these smaller newcomers, created and reshaped through Bombardier’s departure from commercial aviation over the last two years, have the supplier relationships needed to compete sustainably against their long-established rivals?

Strategically, the answer reveals a tension between these small aircraft manufacturers and some of their suppliers who — through waves of consolidation to partially offset the enormous scale of Boeing and Airbus — now dwarf the companies that need their collaboration to have long-term sustainable businesses.

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