Paul Lewis/SINGAPORE
CHINA HOPES to finalise a workshare agreement with European manufacturers and Singapore Technologies (ST) before the end of the year, following the signing of a letter of intent (LoI) last week to develop a 90- to 140-seat regional jet.
Signature of the LoI officially confirms China's selection of Aero International (Regional) (AI(R)) over Boeing to co-develop its planned AE-100. It also creates a framework for detailed negotiations to begin on programme workshare and launch pricing.
The agreed principles call for Aviation Industries of China (AVIC) to be the major programme shareholder, and for aircraft final-assembly and the new joint-venture headquarters to sited in China.
No details have been given on the joint venture's share structure, but AVIC is thought likely to take 45%, the European consortium about 40%, and ST an "upper limit" of 15%. Senior sources emphasises that the final structure is linked to workshare and therefore subject to change
They add that the addition of new partners will also have an impact on the venture's shareholding. Singapore is trying to persuade South Korea to rejoin the Chinese-led programme, after a public row over its proposed stake in the project (Flight International, 3-9 July).
Singapore's final stake will depend on the outcome of bilateral discussions with Taiwan Aerospace (TAC) on participation. Because of political sensitivities in Beijing, TAC is required to work through ST, rather than be allowed its own direct stake in the project.
The make-up of the European consortium is also likely to change, with AVIC and ST demanding that Airbus Industrie become involved in marketing and supporting the new regional aircraft. Airbus's involvement would also clear the way for Daimler-Benz to become a European partner.
China, Europe and Singapore have also still to agree on the aircraft's target launch-price. AI(R) is understood to be pressing to keep the baseline aircraft's cost below $20 million a unit, to be competitive, while AVIC wants to set a higher price.
Source: Flight International
