Japan funds aerospace research and development projects through a complicated scheme that rewards manufacturers for programmes pursued in co-operation with foreign partners as well as independently.
Government loans were provided to Japan's major manufacturers to help cover their portion of development costs for the Boeing 767 and 777 and a similar scheme is being established for the new 787.
The scheme involves the Development Bank of Japan (DBJ) extending a loan to the non-profit Japan Aircraft Development Corporation (JADC), which distributes the funds to participating manufacturers. Japan's Ministry of Economy, Trade and Industry (METI) initially covers interest on the loan by each year allocating part of its budget to the International Aircraft Development Fund (IADF). After the programme reaches the production phase, the manufacturers are obligated to gradually pay back the loan and interest charges.
While funds are committed on an annual basis, METI provides manufacturers with a long-term commitment by awarding "national project" status to qualifying international collaboration programmes. So far seven programmes – the 767, 777, 787, General Electric CF34 and GEnx, International Aero Engines V2500 and Rolls-Royce Trent 1000 – have received national project status.
METI, in its fiscal 2004 budget, began allocating funds for the 787, and in its budget for the year beginning 1 April 2005 funds for the first time will be allocated for aircraft's GEnx and Trent 1000 engines. However, the loans for these three projects will only be extended after master programme contracts are signed.
A separate scheme funds indigenous aircraft and engine development projects. METI annually allocates part of its budget to the New Energy and Industrial Technology and Development Organisation, which distributes the funds to participating manufacturers and organisations. Manufacturers are typically required to put up their own matching funds.
Historically, Japan has always had at least one active research and development project in both the aircraft and engine sectors. The current projects involve development of a regional jet and engine. METI began allocating funds for both projects in fiscal 2003. The aircraft project, which is focusing on the 30-seat market, is to be funded through at least fiscal 2007 while the engine study, which is focusing on 50-seaters, is to continue through fiscal 2009.
The projects could return Japan to commercial aircraft manufacture after a 40-year gap and lead to the production of its first entirely indigenous civil engine. But while Japan is always keen to develop new aerospace capabilities it is reluctant to commit to launching production programmes.
In June Japan completed a five-year study of new-generation engines for supersonic transport aircraft. The project met all design objectives, but in the end there was no business case to begin producing the engine. And before the start of the regional jet project Japan studied a 150-seat commercial aircraft, but this too was deemed economically unfeasible.
Source: Flight International
