Airbus is betting big on China, trusting the country’s aviation market will continue to rapidly expand.
It has just started work on a new factory near its existing plant at the northern port of Tianjin, where it will fit out the cabins and paint wide-bodied A330 jets made in Europe at the rate of two a month. It already assembles A320 single-aisle planes at the site using some locally made parts.
The new A330 finishing centre is due to open in September 2017
Chief Executive Fabrice Bregier said he sees no serious impact from what is happening with Chinese growth: “The economy is slowing down. This is true globally, this is not true for our market. And we believe that for the next five years, 10 percent plus growth year-on-year, in already the second biggest market in the world, meaning it’s extremely important, is a very cautious assumption.”
More Chinese production?
Airbus China chief Eric Chen said the company is looking at whether to increase the production rate in China at its A320 assembly line. It currently delivers four each month to Chinese customers.
Asked about that, and the prospects for eventually building an assembly plant for wide-bodied planes, Bregier said: “China has focused, rightly so, on single-aisles (narrow-body aircraft) a lot, and will continue to procure a lot of single-aisles. But I am sure the next step will be getting more wide-bodies. So perhaps one day there will be enough market to look at such a big investment.”
But he added: “So far we don’t have a business case, because a final assembly line of a wide body, is of course, much more complex, and much more costly. And we would need much bigger quantities to be delivered every year.”
Airbus vs Boeing vs Comac
Airbus has already sold more than 1,200 planes to Chinese airlines and predicts the country will need nearly 5,400 over the next 20 years as it becomes the world’s biggest air-travel market.
Its US rival Boeing has an even bigger forecast. It believes Chinese airlines will need around 6,330 new aircraft in that time frame.
Boeing has also signed a cooperation document with state-owned Commercial Aircraft Corporation of China (Comac) to build a jointly operated completion centre for its 737 passenger jets in China.
Comac hopes to eventually challenge the Boeing-Airbus duopoly. It is developing a narrow-bodied jet – the C919 – which is designed to compete with the A320 and Boeing’s 737. Its first flight was due take place this year but the development schedule has slipped.