China Looking to Land into the Commercial Jet Industry

Commercial Aircraft Corp of China Ltd, known as Comac, is China’s multi-billion dollar gamble to try and compete with the aviation duopoly of Boeing and Airbus in hopes to become a global competitor in the aerospace arena. Their 150 seat jet, the C919, has acquired 360 orders to the program. However, firm orders have just been placed by “Chinese airlines and a a handful of mainly domestic banks and leasing companies” the article stated. To date, the aircraft has not flown but is planning its first flight in 2014 with customer deliveries beginning in 2016. Trying to tap into this market is very challenging and many production delays are anticipated for the launch. 

One aspect that is in Comac’s favor is that “some analysts expect the C919 to be less costly to produce than its direct competitors—the best-selling Boeing 737 and Airbus A320 series aircraft—because of lower labor costs” the article state. However, “most components such as engines and avionics are sourced from Western suppliers.” However, the program is seeing many possible delays in the launch, a lot dealing with delays in airworthiness tests.

Looking more towards the future and further development of larger jets, there have been discussions for Comac and the Russian company United Aircraft Corp of possible collaboration on a more wide-body plane. The potential strategic partnership could help leverage the two nations to better compete against the more established players of the industry. Comac execs refused to comment since the talks are in such an early stage.

Source:http://online.wsj.com/article/SB10001424127887323551004578116770320713876.html?mod=WSJ_business_whatsNews

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