AVIC I branch lands Boeing parts deal

By Lu Haoting (China Daily)
Updated: 2007-08-09 09:57

Chengdu Aircraft Industrial (Group) Co Ltd (CAC), a company affiliated with China Aviation Industry Corp I (AVIC I), yesterday signed a $300-million manufacturing contract with Vought Aircraft Industries Inc to produce Boeing 747-8 horizontal stabilizer parts and subassemblies.

The contract is the third secured by the Chinese aviation industry via China National Aero-Technology Import & Export Corp (CATIC) to produce parts for the B747-8 aircraft, due to enter service in 2009. China is the exclusive supplier to the three programs.

CATIC, jointly owned by AVIC I and AVIC II, is a large-scale State-owned conglomerate that imports and exports aviation products and technologies.

"We are now in talks with Vought to secure more subcontracting work for the B747-8 aircraft, including the production of the vertical stabilizer. We hope to sign more contracts later this year and next year," said Yang Chunsheng, managing director of the supply chain management and procurement division of CATIC.

CAC will start delivering the parts to Vought's Dallas factory for assembly before the end of next year prior to shipment to Boeing's aircraft final assembly line in Everett, Washington.

Texas-based Vought is a major US supplier of aircraft structural assemblies to Boeing.

The B747-8 is Boeing's answer to Airbus' A380 superjumbo in competing for the large-sized aircraft market. Boeing outsources most of the aircraft's airframe structure manufacturing, except the nose and the wings, to Vought, Yang said.

"What we wish to do with CAC and AVIC I's other facilities is to build, over time, the capabilities for higher-level subassemblies. I believe there will be more components and more subassemblies (built by China) as we grow together," said Elmer Doty, Vought president and CEO.

The partnership between CAC and Vought started in 1995 when CAC produced the tail of the B757, a model Boeing no longer produces. CAC later supplied the emergency doors and front access doors of the B737.

CAC and Xi'an Aircraft Industry (Group) Co Ltd, another company affiliated with AVIC I, in June signed contracts with Boeing worth nearly $500 million to supply wing parts of the B747-8. CAC will provide the B747-8 ailerons and spoilers and Xi'an Aircraft will produce the in-board wing flaps.

Boeing has received 25 orders for the passenger version of the B747-8 and 65 for the B747-8 freighter.

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