Mitsubishi Heavy Industries Ltd. said Tuesday it will terminate its plan to develop Japan's first domestically manufactured passenger jet, pulling the plug on a public-private project that was repeatedly hampered by delays before being frozen more than two years ago.
The enterprise, which officially started in 2008 and cost about 1 trillion yen ($7.6 billion), was suspended in October 2020 after frequent technological problems as well as a sharp fall in air travel demand caused by the coronavirus pandemic.
Mitsubishi Heavy initially expected to roll out its first plane by 2013, but a lack of knowhow and technological snags caused the company to postpone its delivery date six times, leading to repeated design changes.
The single-aisle passenger jet with less than 100 seats, named SpaceJet, drew as many as about 450 orders at one point, with customers including ANA Holdings Inc. and Japan Airlines Co. But the figure has decreased to about 270 due to cancellations.
The project, which was supported by Japan's industry and transport ministries, initially raised hopes among many small and medium-sized aircraft parts suppliers across Japan, prompting them to increase capital spending in hopes of growing demand.
But as the company repeatedly failed to meet its delivery date, many of the suppliers and customers started to see the project as "a lost cause," industry insiders say.
Industry experts believe that the company's corporate culture to prefer in-house development, rather than utilizing outside resources, is partly responsible for the failure.
