Paul Lewis/SINGAPORE
CHINA HAS GIVEN South Korea an ultimatum demanding that it concede programme leadership and final assembly of the proposed joint AE-100 passenger aircraft.
Aviation Industries of China (AVIC) issued its counterpart, the Korean Commercial Aircraft Development Consortium (KCDC), a "four-principle" declaration during recent bilateral discussions in Chinese capital Beijing.
The four principles state that AVIC will lead the AE-100 programme; that the country will provide largest single market for the 100-seat aircraft; that there will be one final assembly line in China; and that the joint venture will be headquartered in Beijing
China and South Korea had previously been negotiating for each to take a 35% stake in the project, with 20% to be set aside for a Western airframe partner and the remaining 10% earmarked for a third, junior, Asian partner.
The two sides, however, have been unable to agree on critical issues, the most important of which was the location of a final assembly line. South Korea has been insisting on its own line, in addition to any production site in China (Flight International, 17-23 January).
It was recently decided to delay again the long-awaited selection of a Western partner, until AVIC and KCDC have reached an agreement. There is growing concern, however, that any further hold-up will damage the project's credibility and its 2002 target date for entry into service.
Industry sources say that China's claim to programme leadership, along with final assembly, threatens to undermine South Korean support for the joint venture. There is though, a growing perception amongst Western aviation officials that the programme is now being driven much more from Beijing rather than Seoul.
AVIC has since asked Boeing and the competing Aerospatiale-led European consortium to begin full feasibility studies into the 100-seat-aircraft programme, with little apparent reference to KCDC.
The KCDC's response has been to appeal to Korea to intercede on its behalf in Beijing.o
Korean aerospace sources suggest that AVIC's demands might not have the full support of the Chinese Government.
Source: Flight International
