CANADA will today break into Boeing and Airbus’s long-running duopoly on large commercial aircraft with the launch of a new plane aimed at taking on the two industry titans.

Montreal-based Bombardier, one of Canada’s largest manufacturing groups, is expected to announce the go-ahead for its long-awaited C-Series, which will carry 110-130 passengers.

Bombardier, which made its name in trains, business planes and small regional jets, is expected to say the C-Series will burn 20% less fuel than competing planes from Boeing and Airbus.

The announcement comes on the eve of this week’s Farnborough air show.

The C-Series will cost about $3 billion (£1.5 billion) to build, two-thirds of which is likely to be borne by suppliers and the Canadian government.

Short Brothers, Bombardier’s Belfast subsidiary, is bidding for work on the plane.

Bombardier is making its move despite gloom in the airline industry caused by high oil prices.

The Canadian group sees an opportunity in Boeing and Airbus’s reluctance to launch new small planes.

Boeing chief executive Jim McNerney told The Sunday Times that a replacement for the company’s best-selling 737, an airline workhorse that flies on short-haul routes, would not come until “closer to the end of the next decade”.

Airlines have asked for a 15% reduction in costs - chiefly fuel savings - before they will back a new model.

Analysts had expected Boeing and Airbus to come up with new planes early in the next decade. McNerney said the technical difficulties were great.

“Airlines are asking us for a 15% improvement over the current plane and quite frankly we are finding it hard to do that,” he admitted.

The environment will be a key theme of this year’s air show. BA chief executive Willie Walsh will join executives from Airbus and Boeing at an event to launch a drive for “sustainable” aviation.

Ian Godden, chief executive of the Society of British Aerospace Companies, the organisers, said the industry wanted to take a proactive stance.

“It’s fair to say the industry feels a bit aggrieved having been singled out for criticism, but it is determined to cut emissions. We need to have a global debate.”

The downturn in the world airline industry is likely to mean fewer multi-billion pound orders than at previous shows. Etihad, the fast-growing Gulf carrier, is likely to be an exception, however, with a 100-aircraft order split between Boeing and Airbus.

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