China Plane Plan Takes Off

Related entries: Corporate News, General, News

The plan to get a Chinese passenger jet to market entered a new phase recently with the set-up of a US$2.7 billion company. Times of India notes:

    “Government sources said that the new company, Commercial Aircraft Corporation of China (CACC), will be responsible for researching, developing, manufacturing and marketing a made-in-China large passenger aircraft. The government is the largest shareholder after investing six billion yuan out of the total share capital of 19 billion yuan.

    Two of the major shareholders of the new company are state-run aircraft makers, China Aviation Industry Corp I (AVIC I) and AVIC II. The new firm is expected to produce the first set of aircrafts by 2020.

    The Shanghai city government is the second biggest shareholder after investing five billion yuan. AVIC I is investing four billion yuan. Four other companies- AVIC II, Baosteel Group Corp., Aluminum Corp. of China and Sinochem Corp.- are putting in one billion yuan each.”

Seattle PI adds a quote from Premier Wen Jiabao:

    “This is the dream of several generations and we will finally realize it…We should rely on ourselves to build the large planes’ main technologies, materials and engines.”

So it seems China’s desire for self sufficiency (whether nationalistic or strategic, depending on your perspective) is alive and well. Whether this plan can be delivered – and whether the competitive landscape of a strategic, western-dominated, industry can be turned on its head – remains to be seen. What is certain is that a lot rides on the very different strategies adopted by Airbus and Boeing.

See news sources:

    China to make jumbo jets with a $2.7 billion company
    Times of India – India
    BEIJING: China on Sunday took for the first step to fulfil its long-held dream of manufacturing jumbo aircrafts. It has registered a $2.7 billion company …

    China forms company to build its own jets
    Seattle Post Intelligencer – USA
    By IRENE SHEN China has set up a company to build large jets, challenging the dominance of Boeing and Airbus in the market for planes with 150 seats. …

Leave a Reply

You must be logged in to post a comment.