Aviation firms look to take off in China

By Xin Dingding (China Daily)
Updated: 2011-03-05 15:13
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Aviation firms look to take off in China

Workers dust off a model of a Commercial Aircraft Corp of China (Comac) C919 airplane displayed at the Airshow China 2010 in Zhuhai, Guangdong province, in November. [Photo / Bloomberg]

BEIJING - The chief designer of China's first commercial jetliner, Wu Guanghui, refuted accusations by Western media that aviation suppliers from developed countries are forced to transfer sophisticated technologies in exchange for access to China's lucrative market.

"We are not using our market in exchange for technologies," said Wu, deputy general manager of the Commercial Aircraft Corporation of China Ltd (COMAC) and a member of the 11th Chinese People's Political Consultative Conference National Committee.

In January, US company GE Aviation and Aviation Industry Corporation of China announced they had signed an agreement to form a new joint venture in Shanghai focusing on integrated avionics systems for China's new C919 aircraft and the commercial aerospace industry.

The New York Times reported the news with the comment that "doing business in China often requires Western multinationals like GE to share technology and trade secrets that might eventually enable Chinese companies to beat them at their own game".

But Wu denied the accusation. "We did not coerce foreign suppliers to transfer their technologies to China and the United States still imposes tight restrictions on high-tech transfer to China, including airplane engines," he said.

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"Instead, some foreign suppliers initiated cooperation with Chinese companies because it is mutually beneficial."

He said localized production can reduce tariffs and establishing such joint ventures takes advantage of China's cheaper labor and aids in the production logistics.

Xinhua News Agency reported on Friday that AVIC Electromechanical Systems Company Ltd and Hamilton Sundstrand will set up a joint venture in Xi'an, capital of Shaanxi province, to produce power systems for the C919. With a total investment of $145 million, the joint venture is expected to start production before 2012.

The single-aisle C919 jetliner, which is now in engineering development, is slated to make a maiden flight in 2014 and be delivered to the market in 2016.

COMAC announced last November that it already has orders for 100 C919 planes from major carriers in China and airplane leasing company General Electric Capital Aviation Services in the US.

"We expect more orders this year," Wu said, declining to give more details.

COMAC forecasts 2,300 single-aisle 150-seat aircraft in the next two decades.

While US aviation giant Boeing predicts China will need 4,330 new aircraft over the next 20 years with the fleet expanding to three times its current size to become the largest market outside the US.