Fuel Prices Make Airlines' Small Jets Obsolete?
"The (regional jet) era is over," according to aviation consulting firm The Boyd Group. A report released by the company runs contrary to some forecasts by predicting that instead of a surge in the use of aircraft with fewer than 50 seats the industry will instead see accelerated retirements of about 900 of those aircraft within the next five years as carriers favor mid-sized designs that champion fuel economy. The Boyd Group's conclusions are based at least in part on its interpretation of the impact of record-high fuel costs and potential economic recession and existing fleets' incompatibility with those external forces -- specifically RJ-sized aircraft. Medium-range aircraft with 75-125 seats will make up 40 percent of some 14,000 aircraft forecast to be put into service, according to the firm's report. In that case, Embraer, with mid-size offerings, is currently among the head of the field of potential winners, as there are few high-efficiency mid-sized offerings in the pipeline, according to Boyd. Major carriers like United and American that run a wider gap between the smaller and larger aircraft in their fleets would stand to lose the most.