Republic “Commits” to Up to 200 Embraer Aircraft It’ll Probably Never Fly

This week is the Farnborough Airshow, a biennial orgy of aircraft orders where manufacturers try to flex their muscles and show the world just how much metal (or composites) they can sell. The whole thing is strange to me. Many of the orders are ones that have already been announced in some way or another, sometimes previously as being from “unidentified” buyers. But the news is choreographed to allow allow egos to be stroked, and that’s apparently considered necessary in this world. As usual, there were a slew of orders that rolled in this year, but one stood out because it’s just silly. Regional-operator . Oh, and it has the right to convert to the larger E2 aircraft if it wants. I doubt any of these end up flying for the airline.

I suppose I should be clear here. These aren’t even truly orders. Republic has just signed a “Letter of Intent” for 100 of them (a purchase agreement should be signed “later this year”), and it now has “purchase rights” for the other 100. I’m guessing that’s just a fancy of way of saying they didn’t need to put down much money, but they can take the airplanes if they want them down the line. In the meantime, Embraer gets to pad its order book and make it look like it’s selling a lot more airplanes than it really is. The problem is, Republic doesn’t fly airplanes under its own brand. It only flies as a regional er, and its partners don’t need more regional capacity.

Republic used to have a diverse fleet, but now it only flies Embraer 170/175 aircraft. Currently it has 84 E175s flying as American Eagle, 20 E170s and 16 E175s flying for Delta Connection, and 38 E170s 28 E175s flying for United Express. I should note, these numbers are from Wikipedia so they might not be completely accurate. I didn’t bother to confirm, because the real number doesn’t matter enough for me to bother. Just know the airline operates a ton of Embraer 170/175s, so it does make sense that if it orders anything, it would be more of the same. But the bigger question here is… what will it do with 100 to 200 more of them?

The natural thing to do would be to place more airplanes with its existing partners, but that seems unlikely. Each of the big three US carriers has a strict scope clause which limits just how many regional aircraft can be flown in the 70 to 76-seat range. You can learn a bit more about that here.

The allocations of those aircraft are all full, unless something changes. I wouldn’t expect these rules to change through labor negotiations or anything like that. Sure, American could grow its fleet by also growing its mainline fleet, but it would need to add 250 mainline airplanes to be able to get 100 more regionals. Don’t count on it, and even if it did, don’t count on Republic winning that business.

The best growth potential is if United decides to order a 100-seat aircraft to be flown by the mainline operation. If it does, it will be able to add up to 70 new airplanes under regionals in the 70 to 76-seat category. But if that happens, is United really likely to give that flying to Republic on airplanes that Republic owns? It doesn’t seem likely. Look at what United did just one day prior to this announcement. . These aren’t new-growth airplanes but rather they’re going to replace CRJ-700s that are currently flying. (They will have only 70 seats on them, because they are replacing 70-seat aircraft and United has no room to grow 76-seaters.) But the point is… UNITED ordered the airplanes. It will then pick which regional it wants to fly those airplanes on its behalf.

This isn’t a new strategy. for the airline. And back in 2016, it even took over an order of 24 Embraer 175s that Republic was going to buy. Instead, . United isn’t alone here. recently as well.

So what in the world is Republic thinking with this giant commitment? Will it add new partners? I can’t imagine so. Alaska doesn’t seem to need a new partner and that leaves… nobody else. Republic did used to fly under its own “brand” when it bought Midwest and Frontier and merged them. Maybe it’ll bring that idea back. Or not. That will never happen again considering how poorly that went.

Instead, this sounds like a good old-fashioned made-up commitment. I assume Embraer just needed to pad its order book for some reason, and Republic was the one who jumped in to help. This certainly isn’t unprecedented. Remember when Republic ordered the CSeries back in the day? Yeah, that order may even technically still exist, but there’s no way that airplane flies for Republic either.

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