ARJ 21 —— The selected Airplane for civil aviation market of China

1. ARJ 21 —— The selected Airplane for civil aviation market of China

2. The Appearance of RJ will Change the Structure of Sviation Market

3. The appearance of 50-seated RJ leads to a quiet revolution in the west. 70-100 seated RJ will certainly lead a new revolution in aviation market. 70-100 seated RJ fills the gap between 120-140 seater and 50 seater. Traditional central radiation operation mode connecting trunk route and regional route will be challenged. Regional aviation market will own a more economical and practical aircraft model which can meet all requirements of regional market.

4. 70-100 seated ARJ21 is designed specially for regional aviation market, and it can be compared with single-aisle narrow body aircraft, no matter in route range, cruise speed, comfort, economic and reliability.

5. Common Characteristics： Cruise speed is uniform with large aircraft, with Mach number 0.78; the fastest speed reaching 0.8 M, and can replace perfectly the large aircraft to fly trunk route. Route range can reach 3000 km, some model’s route range can even reach 4000 km, so they can fly directly to the aim airport without landing at hub airport. Seen from the seat number, for “thin and long” routes, if passenger volume of the 70-100 seated ARJ can reach 60%, the break-even point can be reached.

6. Traditional concept for regional aircraft is not suitable for the over 70-seated jet that performs regional aviation transport. Current ARJ21 family aircraft cannot be compared with regional aircraft in traditional meaning, and should be treated differentially. It is more exact if it is called “regional jet”

7. Aviation market can generally divided into two categories: intercontinental-oversea market and regional market

8. “Intercontinental-Oversea” market “Intercontinental” connected with “oversea”, large span, super-long flight time, super-long route, large passenger flow , usually use double-aisle wide body aircraft

9. Regional marketregional market can be classified as large region and small region For example, North America, South America or Europe can be treated as a region, then it is a big region China can be treated as a big region, and it can also be divided into several small regions, such as northwest, northeast, Yangtze delta, Zhujiang delta, circle-Bohai sea, etc.

10. Compared with intercontinental and oversea market, regional aviation market is more complicated and its characteristics is more remarkable.

11. The difference between regions is obvious America：“hub radiation”, trunk route and regional route are combined. Europe： “point to point”, propeller aircraft are used in large quantity. China：“point to point”, propeller aircraft is seldom used. Single-aisle narrow-body aircraft take up the main market share.

12. Within region, the market forms are diversified Take China market as an example： Airport condition is different The route distance is different The passenger flow is different The passenger ingredients are different The competition degree is different The profits level is different

13. Display on operation: The seat-class is a little larger than needed. Regional aircraft is crowded out. Large number of lines are in lose Lines are often opened ,and stopped, then reopened, and re-stopped.

14. Future trend The regional aviation market is challenged by railway’s rising speed and highway’s extension. The quantities of long-route and wide-body aircraft in express market( for example, Beijing-Shanghai Air Express) will be controlled; for flight segment within 500 kilometers, the operation space of propeller aircraft will be restricted. The domination position of single-aisle trunk-route aircraft in regional aviation market will still be strong. However, regional jet will play a new role in small and medium volume transport market.

15. ARJ-21 the regional jet that can meet the market requirement of China

16. The factors that influence the development of aviation transport The following are the main factors that promote the development of China’s aviation transport, and they will continue to push the stable increase of China’s aviation transportation: • National economy’s development is the main power for the development of aviation transportation. • Reform and opening up to the world promotes the foreign economic and cultural exchange, so the demand for aviation transportation increases year by year. • People’s living level improves, and consumption structure upgrades, so more and more people choose air transport when they travel. • The development of tourism bring more passenger source for air transportation. • Urbanization expands continuously the market space of air transportation； • Air-traffic management construction is fastened, which releases the situation of our country’s tight air space. • The invest in airport construction is increasing, and China’s civil aviation airport will reach 250 by the year 2020. • China civil aviation industry deepens the reform, fastens the marketization of air transportation, and encourages the development of non-government air ransportation. Push the orderly competition of air transportation, and guarantee the prosperity of air transportation from inner mechanism.

17. China ranks second position all over the world in total transport turnover, total passenger turnover, and freight turnover. The increase of air traffic in 2007 Air Traffic in 2007 Increase rate 100 Mil. kilo Total transport turnover Total passenger turnover Freight turnover America China Britain German Japan France

18. In the past three decades, China’s passenger transport by air maintains fast growth, and reaches 280 billion person km in 2007. Previous Year’s Growth of Air Transport Passenger TurnoverChina RPKs Growth Increase rate

19. Share of Air by RPK In the transportation system, turnover volume of passenger by air is increasing year by year. It increases 13% in 2007. 2007 1997 Water transport 1.6% Water transport 0.4% Air transport8.0% Air transport 13.0% Highway 53.2% Highway53.8% Railway 36.5% Railway 33.5%

20. The regional aviation structure will tend to be reasonable: • The implementation of strategic plan for the great west development, rejuvenation of northeast and rising of middle China • The speed-up of urbanization, the improvement of people’s living standard, the upgrade of consumption structure, and the development of tourism • Optimize air-space structure, utilize effectively the air-space resource, carry out the measures to release the tight air-space; civil airport will fasten the development following the guideline of “promoting the east, strengthening the middle and thicken the west”; operation circumstance of regional aviation will be continuously improved. • CAAC issues a series of policies: release the air-traffic control, expand the opening up, introduce non-government capital, support regional aviation, all of these input new vigor and energy for the continuous development of air transportation. • The quantities of ＲＪwill increase steadily.

21. Run way length of China’s civil airport (data of July,2008) 5500 通航机场总数：159 5000 未开通定期航班的机场数：7（跑道长度短于1600 4500 米） 4000 3500 Run way length (m) 3000 2500 2000 1500 未开通定期航班的机 1000 场 500 0 0 20 40 60 80 100 120 140 160 180 a/p num. Altitude distribution of China’s civil a/p (data of July,2008) 5000 : 159 通航机场总数 4500 九寨沟机场 4000 Airport category airport 3500 高高原机场：7个 Large composite hub airport 北京、上海、广州 3000 2438米 Large hub airport 沈阳、武汉、深圳、成都、昆明、西安、乌鲁木齐 a/p altitude) 2500 天津、大连、哈尔滨、杭州、厦门、青岛、南京、福 2000 高原机场：12个 Medium hub airport 州、济南、温州、长沙、桂林、郑州、海口、三亚、 1500 昆明机场 重庆、贵阳 1500米 1000 呼和浩特、太原、石家庄、长春、南昌、合肥、宁波 500 Medium airport （trunk line） 、晋江、烟台、南宁、张家界、拉萨、九寨沟、西双 0 版纳、丽江、兰州、银川、西宁 0 20 40 60 80 100 120 140 160 180 a/p num. Small airport （regional line） Other airport • For the civil airports that own scheduled flight, the shortest run-way is 1700m. • China has 12 plateau airports (altitude between1500~2438m), including southwest hub-airport—Kunming airport • China has 7 high plateau airports (altitude higher than 2438m), including Lasa airport and Jiuzhaigou airport. CAAC regulates strict operation standard, so the operation cost improves obviously.

22. Domestic flight routes operated by China civil aviation Domestic flight of China(2008) Daily flight VS. flight distance 3100-3199 2900-2999 2700-2799 2500-2599 2300-2399 2100-2199 1900-1999 Flight distance (km) 1700-1799 1500-1599 1300-1399 Average flight distance： 1033km 1100-1199 900-999 700-799 500-599 300-399 <200 0 100 200 300 400 500 Daily flight number • The longest domestic flight route operated by China civil aviation is “Urumqi-Guangzhou”, 3275km; the longest route that was once operated in history is “Urumqi-Sanya”, 4074km • The flight whose route distance is equal or shorter than 1000nm occupies 98% of the total flight • The average route distance is 1033km • 84% of the passenger turnover of domestic flight routes are completed by single-aisle aircraft • The weighted average seats number of single-aisle aircraft that operate domestic routes is147.

23. Data of lowest safety Alt. of China civil Avi. >5000 <3000km （L S A m，L D ，not include Tibet C2 Flight alt. distance Lowest safety alt. line （km） （m） （100m） - 乌鲁木齐 库车 548 5200 84 - 兰州 成都 751 5230 90 - 西宁 成都 893 5230 90 - 兰州 重庆 964 5230 90 - 银川 成都 1038 5230 90 - 西宁 重庆 1106 5230 90 - 兰州 昆明 1365 5230 102 - 西宁 昆明 1507 5230 108 - 兰州 桂林 1577 5230 102 - 兰州 广州 2003 5230 102 - 兰州 深圳 2081 5230 102 - 兰州 海口 2110 5230 102 - 兰州 珠海 2110 5230 102 - 西宁 广州 2145 5230 102 - 乌鲁木齐 和田 1023 5889 90 - 乌鲁木齐 西宁 1543 6081 102 - 乌鲁木齐 兰州 1654 6081 108 - 乌鲁木齐 西安 2183 6081 102 - 乌鲁木齐 成都 2403 6081 102 - 乌鲁木齐 洛阳 2570 6081 102 - 乌鲁木齐 重庆 2616 6081 102 - 乌鲁木齐 郑州 2684 6081 102 - 乌鲁木齐 武汉天河 2893 6081 102 - 迪庆 昆明 481 6196 81 - 迪庆 西双版纳 709 6196 81 Domestic flight routes operated by China civil aviation • The lowest safety altitude of China’s western routes is comparatively high. The aircraft that operates western routes need high single-engine rising limit and excellent emergent oxygen supply ability. • The lowest safety altitudes for routes that connects Urumqi with other inner city is 6081m, the lowest safety altitudes for route to Diqing is 6196m.

24. Survey in off season of 2008:travel purpose 50% 66% business 31% 42% 28% Visit 55% 8% 全国 6% other 北京 14% 昆明 0% 10% 20% 30% 40% 50% 60% 70% 80% 旅客比例 Survey in off season of 2008: payment source 44% 59% public 32% 50% 36% private 63% 4% FFP 4% Mile exchange 1% 全国 2% 北京 1% other 3% 昆明 0% 10% 20% 30% 40% 50% 60% 70% 80% 旅客比例 • The questionnaire survey for passenger characteristics of China aviation conducted in 2008 shows that the comprise of China’s air-transport passengers has changed from focusing on business passengers to equal emphases on business passengers and tourist passengers. Passengers’ ticket payment source has changed from emphasizing on public fund to both the public fund and private fund. “Swallows that in the hall of grand houses used to nest; have flown into the homes of common folks there to rest. ” China has entered the times of popularized air transport. • Public-payment or business passengers are sensitive to the cabin comfort and flight frequency; private-payment passengers or tourist passengers attach great importance on the ticket price. • The change on passenger structure tells us the design for the future large aircraft should account for both the business passengers and the tourist passengers.

25. China civil aviation fleet（July,2007） Ratio occupying total fleet Ratio occupying total passenger seats Model 10% 18% Double-aisle 83% 80% Narrow body A/C 7% 2% RJ Due to the serious shortage of regional aircraft, large quantities of low and medium passenger-flow route lies in the state of waiting for exploitation; some low and medium flow routes use narrow body aircraft to operate with low frequency, the booking rate is low and the market is unstable. It is reported that the daily flight frequency of 58.4% of city-pair lines lower than 1 in 2006.

26. ARJ21 ：range and seat-class 220 B767-300 CAAC own 842 NB A/C B737-900 200 NB A/C July, 2007 B737-800 B757-200 180 A321-100 A321-200 160 A320-200 B737-400 B737-700 B737-300 MD82 140 MD90 Seat-class A319-100 B737-500 B737-600 120 ARJ21发展型 100 A big market between NB A/C and small RJ forARJ21 ARJ21-700 80 CRJ700 ATR72-210 60 CRJ200 ERJ145 40 CAAC owns 74 small RJ (Jule,2007) Small RJ DO328 7 20 0 1000 2000 3000 4000 5000 6000 7000 8000 range（km） The market positioning of ARJ21： The market positioning of ARJ21： ARJ21 accounts for both the business passengers and the tourist passengers, and is suitable both in the east and in the west, so it has large market space between narrow body aircraft and small regional aircraft.

27. ARJ21’s seat-class Wholly economic-class layout：90-seat Compared with small 50-seated regional jet, its operation cost of unit seat is remarkably lowered. Mixed seat-class layout: 78-seat Its comfort can be compared with 150-seated narrow body aircraft, and it can take place narrow body aircraft to improve flight frequency or increase flight coverage rate. Therefore, it is attractive for business passengers. 90-seated wholly economic-class layout （31 inch row distance) 78-seated mixed seat-class layout（36/32 inch row distance)

28. ERJ170175/190/195 CRJ700/900 ARJ21 CRJ700/900 ERJ170/190 ARJ21 Cabin height（m） 1.89 2.00 2.03 Cabin width（m） 2.55 2.74 3.14 Aisle width（inch） 16.00 19.75 19.00 2 Cabin section area（m ） 3.69 4.28 5.886 3 Per row cabin cmb（row distance 32inch）（m ） 2.999 3.479 4.784 3 Cabin cmb/seat（m /seat） 0.75 0.87 0.957 + + Per seat cabin Comp. base 16% 28% Cabin comfort of ARJ21 Compared with rival aircraft, ARJ21 owns outstanding advantage on cabin comfort

29. China’s Domestic Flight (2007) Daily flight No. VS. flight distance 3701-3800 3501-3600 ARJ21-700ER设计航程2000nm, 能满足绝大多数航班的需求。 3301-3400 3101-3200 2901-3000 2701-2800 2501-2600 2301-2400 Flight distance(km) 2101-2200 ARJ21-700ST设计航程1200nm, 1901-2000 能满足95%航班的需求。 1701-1800 1501-1600 1301-1400 1101-1200 901-1000 701-800 501-600 301-400 <200 0 100 200 300 400 500 Daily flight No. ARJ21’s range The design range of ARJ21-700ST:1200nm（2222km） Meet the range requirement of 95% domestic flight. Be able to take off/land at high temperature/plateau airport in the west of China. The design range ofARJ21-700ER:2000nm（3704km） Meet the range requirement of most domestic flight. The profit will be high if it is used on thin and long “point-to-point” flight line.. The design range of ARJ21-700ER:2000nm, Meet the range requirement of most domestic flight The design range of ARJ21-700ST :1200nm,Meet the range requirement of 95% domestic flight

30. The Airport Adaptability of ARJ21 The airport design requirement for ARJ21-700ST is: be able to take off/land with gross weight （1895m,ISA+25ºC, considering obstacle）at Kunming airport in hot weather. Therefore, ARJ21 will be the best regional jet suitable the strict operation requirement of China’s west airport and flight line. Take off weight at limited by rising degree at the 2nd phase Distribution of China’s civil airport altitude (data of Oct.,2007) Total number of airport circumstance temperature (°C)

31. ARJ21 will provide new opportunity for airlines to expand current market and open new market： • Open new line, particularly the line whose range is too long if turboprop aircraft are used, and whose passenger flow is insufficient if narrow body aircraft（B737 or A320）are used. Most of these lines have not been opened because there is no suitable aircraft model, including: -- Extend the line to the low passenger flow airport, and push regional economic development； --Open new “point-to-point” long line, including hot tourist spots, and medium cities with active economy； -- Provide suitable aircraft model for opening western aviation market whose operation requirement is strict； -- Open international regional line from Urimuqi to Middle/West Asia and Middle East, and build up fast and convenient “Silk Road in the Air” • Take place narrow body aircraft on low passenger flow route, so as to solve the problem of over-transport capacity, improve flight frequency , stabilize and expand regional air-traffic market. • Take place turboprop aircraft and small turbofan aircraft, provide fast and comfortable regional service to meet passenger’s expectation, realizing the perfect joint of trunk line and regional line, especially suitable for business regional market. • Provide other derived model for market (freight aircraft and business aircraft)

32. “point-to-point” direct flight can be realized due to the appearance of ARJ21, which is the most suitable model for regional jet, and there is no need to fly the traditional “hub-regional” mode. ARJ21 will be an important transport vehicle in China’s regional transporting market and make significant contribution for the prosperity of China’s air traffic market.

33. Thank You ！