A state-owned Chinese company has committed to buy up to 300 Boeing aircraft to distribute among airlines and leasing companies.
Boeing has agreed to use Chinese manufacturer AVIC more in its commercial aircraft supply chain, and with Comac to jointly set up an in-country narrowbody completions and delivery centre.
Sometimes a single announcement can signal a grand strategic move, binding two countries in partnership beyond a simple commercial transaction.
For Boeing, there was a moment in the 777 programme in the early 1990s when the role of Japanese industry and airlines rose above buying and selling. Its airlines now enjoy premier status as Boeing customers. And only Spirit AeroSystems is more firmly embedded in the top tier of Boeing’s supply chain than the three Japanese “heavies” – Mitsubishi, Kawasaki and Fuji.
How do the recent agreements with China compare? So far, it is not even close.
Creation of the completion and delivery centre in China is not, in itself, a strategic shift. On the face of it, it seems impressive. Never before has Boeing performed these tasks outside the USA. However, the Comac deal falls short of Airbus’s A320 final assembly line in Tianjin. Rather, it seems more like a practical solution to a looming capacity problem in Renton, Washington, the site that currently assembles 42 737s per month. With production rates rising to 52 each month by 2018, it makes sense for Boeing to look for alternate venues for furnishing and painting already assembled aircraft.
China is the obvious location to place such work. Boeing’s latest market forecast assumes Chinese customers will take delivery of 4,630 new single-aisle aircraft over the next 20 years – a staggering average rate of 19 single-aisle deliveries each month – up to 2034.
Even if Boeing must split the single-aisle market with four competitors – Airbus and the three new entrants – the numbers easily justify a permanent delivery centre, if not more. Potentially more significant is the commitment to share more sub-assembly work with AVIC. Japan’s industry became involved in Boeing in much the same way, beginning with the 767 programme in the late-1970s. It will be revealing to monitor the work packages assigned to AVIC as the deal is finalised.
Boeing’s industrial presence in China is certain to continue growing. One day, perhaps, there could be a Chinese-assembled “7C7”, but these latest agreements fall far short of such a move.
Source: Flight International
