Airbus/Boeing pin hopes on China orders

Paul Lewis/SINGAPORE

Airbus Industrie and Boeing are hoping that forthcoming visits of US and European leaders to Beijing will produce follow-on aircraft purchases, as China Aviation Supplies (CASC) completes the final allocation of the 80 airliners ordered last year.

Boeing is believed to be working on the sale of a second package of around 50 narrow and widebody jets to CASC, which could be announced during the visit of US President Clinton to Beijing in June. China has also invited French prime minister Lionel Jospin to visit later in the year, which industry sources suggest could result in further orders for Airbus.

China has in recent years sought to maximise the political capital gained from aircraft orders, by linking their announcement to the visits of senior officials to the USA and Europe and of foreign leaders to China. At the same time, manufacturers are urging China to plan ahead as production lines in Seattle and Toulouse sell out.

Local observers, however, are sounding a note of caution that any pending CASC orders may be smaller than expected, as China waits to assess the full impact of the recent Asian economic crisis on international traffic. Load factors are already in decline, partially because of domestic fare increases.

Nonetheless, demand for additional aircraft remains high, even after the final allocation of the 26 Boeing 737-700/800s, 10 737-300/ 400s, eight 777-200ERs, five 757s and one 747-400 ordered during the visit of China's President Jiang Zemin to Washington last October (see table).

According to Chinese airline industry sources, CASC's allocation only meets a portion of the total number of aircraft requested, with Air China and China Southwest seeking large numbers of additional Next Generation 737s to complete their refleeting.

Meanwhile, China Northern Airlines is emerging as the favourite to take the 10 remaining A321s still to be allocated from the 30 Airbus A320 family aircraft ordered by CASC last May. The aircraft would supplement 13 Boeing MD-90-30s on order, nine of which have been delivered,

Of the remaining 20 aircraft, China Northwest has secured three CFM56-5-powered A320s. Another 10 A320s have been set aside for China Eastern, three more A320s are to go to China Southern and a further two A320s and two A321s are for Sichuan Airlines.

Source: Flight International