Mitsubishi Heavy Industries Ltd. is considering sharply scaling back the staff and budget for developing the first domestically manufactured regional jet, effectively freezing the operation due to a slump in demand caused by the novel coronavirus pandemic, sources close to the matter said Thursday.

The Japanese firm's subsidiary Mitsubishi Aircraft Corp. has been developing a small aircraft called the Mitsubishi SpaceJet, previously known as the Mitsubishi Regional Jet. Its initial delivery to All Nippon Airways Co., originally planned for 2013, has been postponed six times to 2021, or possibly later, due to problems with parts.

The new jet, if successfully launched, would be the first commercial aircraft manufactured in Japan in half a century.

Mitsubishi Heavy is expected to announce the decision on Oct. 30 when it unveils a new medium-term business strategy, the sources said.

Delivery of the Mitsubishi SpaceJet has been delayed six times so far despite around 1 trillion yen ($9.6 billion) having already been poured into development of the airplane.

In the business year through last March, Mitsubishi Heavy posted an operating loss for the first time in two decades due to ballooning SpaceJet development costs.

Mitsubishi Heavy launched the MRJ project in 2008 and the maiden flight took place in November 2015.

Airlines are struggling amid the pandemic that has led many countries to impose travel restrictions.

==Kyodo

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