Aviation industries of China (AVIC) is voicing concern that the planned AE31X airliner family risks missing the market, unless an overall agreement can be reached with joint- venture partners Airbus Industrie Asia (AIA) and Singapore Technologies (STAe) by the end of the year.
Pre-development work on the 105-seat AE316 and 125-seat AE317 is scheduled to start in early 1998, leading to a planned first flight around mid-2002 and service entry about 12 months later. This timetable is predicated on the three sides reaching a final business agreement by the end of 1997, but major issues are still outstanding.
"We really worry about the delay, because the market is slipping away," says AVIC international co-operation and trade general director Tang Xiao Ping. "Our target is still the end of this year, but it's going to be difficult to finish our work before the end of 1997."
With Boeing looking set to back continued development of the 106-seat MD-95 launched by McDonnell Douglas, AVIC is keen to get the competing AE31X on the market as soon as possible. "We hope there is not going to be another half-year delay. One or two months is okay, but too much delay will be a problem," says Tang.
AVIC has been in negotiations with AIA and its predecessor, Aero International Asia, for over 15 months. STAe has also expressed concern about the amount of time it is taking to conclude a deal. AVIC president Zhu Yu Li recently travelled to Toulouse to impress on Airbus Industrie chief executive Jean Pierson the need to give the programme a higher priority.
The Chinese Government's recent decision to grant the joint venture preferential tax status on sales and import duty has cleared one hurdle. There are, however, still many unresolved issues to be settled, including a detailed agreement on work-share, the cost of transferring European technology to China and where to register and base the joint venture.
AIA, in turn, is warning that, while it is not opposed to putting technology into China, any large-scale transfer will add to the development time. "There is a trade-off between being on the market rapidly and transferring technology," says Aerospatiale executive vice-president and AIA board member Claude Terrazzoni. "The target is to produce an aircraft, not transfer technology."
Central to the issue of work-share is the need to keep development and production costs to a minimum. One solution being proposed by AVIC is to move more labour-intensive structural production away from Europe into China, including both the wing and most of the fuselage. "We're in discussions, all is open; nothing is closed," responds Terrazzoni.
Source: Flight International
