Within three years, a popular aircraft manufacturer will produce an updated version of a workhorse North American jet that’s more fuel efficient, quieter and passenger friendly than today’s model.

Yet, no U.S. airline is expected to fly it, at least at first.

The aircraft is the Embraer 175, and most regular travelers in the United States have probably flown on one. Usually configured with 76 seats, the jets are branded as American Eagle, United Express, Delta Connection and Alaska Airlines, but they’re operated by separate, regional airlines, who pay pilots and flight attendants less than major carriers. That’s important because the airplanes are more expensive to operate, on a per-seat basis, than a typical Airbus or Boeing jet.

Unlike a competitor made by Bombardier, the CRJ900, these regional aircraft feel like a much bigger airplane, with roomy overhead bins and high ceilings. Major airlines often use them to shuttle passengers from midsize cities into their hubs, though they’re sometimes dispatched on popular business routes, such as Chicago to New York, where business travelers demand frequency but airlines don’t need that many seats.

After American Airlines said it would add 15 last month, bringing its fleet to 89 by next year, Embraer said it had sold more than 400 E175s to North American airlines since 2013, representing more than 80 percent of all orders for 76-seat jets.

With fuel prices rising, regional U.S. airlines would seem like excellent candidates for the next-generation jet, called the E175 E2. But they’re not, not because they don’t want them, but because they can’t fly them for major airlines. Most big airlines have collective bargaining contracts with pilots that bar regional airlines from flying them.

This is the case even though the jet is nearly identical to its predecessor, just with more advanced (and heavier) engines. This restriction is a problem, as it means regional U.S. airlines may not be able to capitalize on advances in aircraft technology without help from labor.

“It should offer the best costs ever for its size class,” said Richard Aboulafia, vice president for analysis at Teal Group Corp. “It has new engines and the latest and best aerodynamics.”

Protecting Jobs

Big airline unions often eye the E175 warily, and many have contractual protections to ensure major carriers don’t rely too heavily on them, taking jobs from pilots who fly larger jets at higher wages.

Seat count has always been a concern. While E175s can fit more seats, they’re usually capped at 76, so most have big first class cabins. Moreover, some union contracts limit on how many of the jets the big airlines can fly.

But the problem with the E175 isn’t seat counts or fleet caps. Instead, it’s maximum takeoff weight.

Major airline pilot union contracts usually restrict the maximum takeoff weight of jets flown by regional airlines. And the E2, with a maximum takeoff weight of about 99,000 pounds,  is considerably bulkier than the current generation airplane and about 13,000 pounds heavier than is generally permitted.

Weight is an outdated way to measure what is a regional aircraft, Arjan Meijer, chief commercial officer for Embraer Commercial Aviation, said in an interview earlier this month in Sydney. He called it a “paper limitation” selected years ago, before anyone had thought about an updated E175 with new Pratt & Whitney geared turbofan engines.

“Even though we can now deliver an aircraft which is more efficient, more economical and also better for the environment and with no change in the number of seats, we can’t deliver it to the American regionals because there’s an limitation on max takeoff weight,” Meijer said.

No Solution

For years, both Embraer and Mitsubishi, a competitor with a similar problem, argued major airlines would renegotiate contracts with pilot unions to remove the takeoff weight clause.

Meijer said Embraer is still optimistic, but it’s not clear anything will change soon. Every airline is different, but for the most part, pilots finally have leverage with management, and they seem to have little interest in giving up protections.

“You would think there would be an easy place for compromise between unions and management, but historically it has been very hard,” Aboulafia said.

In an email, American Airlines pilot union spokesman Gregg Overman said if American wants next-generation E175s, it can buy them for its own operation, rather than assign them to a regional airline. (An American spokesman declined to comment.)

“It can be flown today by mainline pilots here,” Overman said. “The Allied Pilots Association has no intention of relaxing the scope language in our contract.”

There’s little chance of that happening, considering American is jettisoning its current generation Embraer E190s – a larger version of the E175 — next year because it doesn’t need a 100-seat aircraft under a mainline cost structure.

Unusual Approach to Maintain Share

Manufacturers generally don’t like producing two aircraft at once. But after 2021, Embraer plans to produce both old and new models, as the United States is too important of a market to walk away from.

This will help regional airlines like SkyWest, which operates E175s for United, Delta and Alaska. Five years ago, SkyWest placed an order for 100 E175 E2s, and while the order is still on the books, the airline will take older models if necessary, spokeswoman Marissa Snow said.

“We announced an agreement with Embraer for the E2 back in 2013, pending major partner flying agreements,” she said. “The objective is to maintain fleet flexibility and our ability to respond to partner needs, and we are well positioned to do so as necessary.”

Still, Meijer said he is hopeful that once the aircraft is available, something will change.

“I think from from a rational perspective, we should only allow these aircraft to come to the market because it’s better for fuel burn,” he said. “It’s better for the environment. And from our collective responsibility, we should be able to bring that aircraft into the market.”

Embraer is also trying to sell outside the United States. Generally, regional jets have not sold as well elsewhere, with airlines on other continents preferring larger jets, including the Embraer E190 and E195, which seat about 100 passengers. While non-U.S. airlines also contract with regional airlines to provide service on smaller aircraft, nowhere is the scope of the operation as large as in North America.

Nonetheless, Meijer said it is possible airlines in Asia, Europe and elsewhere will want the newest E175, in addition to updated versions of the E190 and E195. The E190-E2 is already flying for Widerøe, a Norwegian airline.

“Whatever happens in the U.S., there’s also demand for the segment elsewhere in the world,” Meijer said.

Embraer may soon have a major ally its effort to sell more jets. The manufacturer is reportedly in the final stages of negotiating a joint venture with Boeing that could help Embraer reduce its costs and improve its market position.

If the deal happens, the two companies would combine their marketing, manufacturing and engineering teams for commericial aircraft, with Boeing taking the lead.

Photo Credit: U.S. airlines love the Embraer 175, the regional aircraft pictured here. But their agreements with pilots will not allow them to fly the next-generation version of the jet. American Airlines