Airbus and Boeing are high expectations for Chinese aircraft demand

China's--Airbus and Boeing’s high hopes for Chinese aircraft demand were on display at the Beijing air show this week but the ambitions of a homegrown upstart foreshadowed a tough fight for market share in the world’s most important battleground for plane manufacturers.
Their forecasts were consistent in depicting China as the biggest purchaser by far of new aircraft over the coming two decades, spurred by twin booms in the country’s business and leisure travel.
Boeing said China would add 5,000 commercial aircraft worth $600bn by 2030, while Airbus said the country would need more than 4,000.
The Commercial Aircraft Corporation of China (Comac), the government-owned manufacturer, predicted the total would be 4,684, giving the country 15 per cent of the total global aircraft fleet, up from 9 per cent now.
Boeing, the current leader in China, wants to maintain a market share of a little more than 50 per cent over the next 20 years and Airbus hopes to increase its portion above 50 per cent.
But Comac, which has yet to deliver a single aircraft, has set its sights on grabbing one-third of the domestic market in the next two decades.
Initially at least, Comac’s ambitious goal will not bring it into direct competition with Airbus and Boeing. Its first aircraft, the 90-seater ARJ21 regional jet, should go into service next year.
The world’s two biggest aircraft manufacturers do not compete in this market segment, which is dominated by Canada’s Bombardier and Brazil’s Embraer, and is served by jets capable of carrying between 60 to 100 passengers.
“Most of the airports that China will open in the next decade will be in smaller cities and this will create more flight routes for the ARJ21,” said Tian Min, a Comac official.
But the real prize in China is the market for larger single-aisle jets. Typically served by 150-seat aircraft, it will account for 71 per cent of total aeroplane deliveries in China by 2030, Boeing forecast.
Comac’s offering in this market, the C919, is still at least two years from its maiden flight, but has benefited from the national prestige that the government has invested with the objective of breaking the Airbus-Boeing duopoly.
Comac has received 100 order commitments for the C919, mostly from domestic state-owned airlines, and it is hoping to announce about 50 more next month.
“The way this market works, they [Comac] will eat into everyone’s share,” said Ihssane Mounir, a senior vice-president with Boeing. “But we are not worried about competition. Competition is the mother of all improvements.”
Comac has been slow out of the blocks. Mr Tian said there would be no deliveries this year of the ARJ21, which is at least three years behind schedule. Industry analysts say the slow introduction of the regional jet could push back the completion of the C919.
Airbus and Boeing were able to tout minor victories for their next generation of aircraft at the Beijing show.
Boeing has not sold any of its 787 Dreamliner long-haul jets to Chinese customers since 60 orders were placed in 2005 but Mr Mounir said that discussions were progressing and could lead to more deals soon.
Airbus received a boost when China Southern Airlines announced that it would take delivery of the country’s first A380 superjumbo jet on October 15 and put it into domestic service two days later.
In trying to catch up with Boeing in China, Airbus has followed a strategy of localising its operations to a certain extent, assembling A320 aircraft in the northeastern city of Tianjin. Boeing has chosen not to make planes in China, though it notes that it has been the biggest purchaser of made-in-China aviation parts.


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