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Source: Reuters

INTERVIEW-UPDATE 1-M'bishi Aircraft aims for profit in 10 yrs

Published: 25 Sep 2010 18:05:29 PST

* In talks with 5-6 firms on sales of Mitsubishi Regional Jet

* Wants to make 6 jets a month in 4-5 years after launch

* Plans to to develop a 100-seat model by 2018 or earlier (Adds background)

NAGOYA, Japan, Sept 22 - Mitsubishi Aircraft, a subsidiary of Mitsubishi Heavy Industries, expects to turn its regional jet business profitable in about 10 years when it will have cumulatively sold 500 planes, its president said.

Hideo Egawa also told Reuters in an interview that the company was in talks with five to six airlines and leasing companies on sales of the Mitsubishi Regional Jet (MRJ), which it plans to start producing by early next month for delivery in 2014.

"We want to be making six jets a month in 4-5 years time after the product launch. If that manufacturing level continues for 6-7 years, that's when we should clear the break-even point," Egawa said at Mitsubishi Aircraft's headquarters in Nagoya, central Japan.

The MRJ will be built in 70-seat and 90-seat variants, placing it in competition with jets made by Brazilian group Embraer and Canadian company Bombardier Inc as well as jets designed by Russian and Chinese firms.

Mitsubishi Aircraft, owned 64 percent by Mitsubishi Heavy, has said Japan's first domestically developed passenger aircraft will be more fuel efficient and help airlines cut operating costs by as much as $20 million over the next 20 years.

Japanese airline All Nippon Airways has already committed to buy 25 MRJ models, which is scheduled for its first test flight in the second quarter of 2012 and first customer delivery in the first quarter of 2014.

Egawa also said the company plans to develop a 100-seat MRJ model by 2018 or earlier after the smaller models are successfully launched.

The model is popular with European carriers.

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