The rapid expansion of domestic services and the creation of new airlines to compete with established government-owned carriers has led China to become a favoured market in which many Western manufacturers compete for custom.
Not that China lacks the capability to produce aircraft and helicopters of many different types but, for the most part, this results from experience in the licensed production of military aircraft of Soviet origin. Nevertheless, some companies ? such as the Chengdu Aircraft Corporation ? have refined Russian design and succeeded in winning exports contracts.
While this production and development experience has provided China with centres of excellence in aviation, to date there have been few examples of indigenous designs that have succeeded on world markets.
An exception is the 17-seat Harbin Y-12 Short Take Off and Landing (STOL) utility transport which has sold in modest numbers in some Asian and African countries as well as to domestic carriers. Indeed local demand for some 200 units is estimated.
The break-up of the former Soviet Union resulted in an evident need for contraction in its aircraft industry but China, by contrast, has built up useful relationships with Western manufacturers over a long period by undertaking sub-contract work.
More often than not, this has come about as a result of off-set agreements concluded when orders have been placed for Western-built airliners. For in this regard too, China has led the former Soviet Union, generally preferring airlines of Western design to those produced in Russia or the Ukraine.
Consequently, commercial links have been established by such Chinese factories as Xian, Chengdu, Harbin, Shanghai and Shenyang where subcontract work for Airbus, Aerospatiale, British Aerospace, Boeing, Canadair, De Havilland Canada, McDonnell Douglas and Shorts has been carried out.
These subcontract agreements were forged by the China National Aero-Technology Import and Export Corporation (CATIC) which has become one of the country's largest trading companies since its foundation in 1979.
However, the Shanghai Aircraft Manufacturing Factory went a step further than other Chinese subcontractors when in 1986, it began the assembly of the first of 25 MD-82 jet airliners under licence from McDonnell Douglas. This not only provided an opportunity to produce a modern Western design (progressively incorporating Chinese-made components), but also to become familiar with Western certification procedures.
However, although McDonnell Douglas went on to win the fiercely-contested competition to supply the China Trunkliner Programme, (initially involving 40 aircraft), this has not noticeably dented Boeing's share of the market.
On the contrary there is some evidence to suggest that some newly-formed airlines in China demonstrate their independence by ordering equipment without involving CAAC's central acquisition process.
For example in 1985 when, despite opposition from CAAC, the government permitted the establishment of Shanghai Airlines as an independent carrier, Boeing proved to be a beneficiary with orders for 757 and 767 airliners. Boeing currently has outstanding orders from Chinese carriers for no less than 225 jet airliners worth some $9 billion.
Although lacking experience in negotiating purchases from Western manufacturers, Chinese managements have not been unaware of the current world recession which has resulted in a sharp fall in airline orders. Not only has it been possible to strike good bargains but early deliveries have usually been made from stocks of unsold aircraft.
Having had contact with Western manufacturers for many years as a purchaser, operator and subcontractor, CATIC has not hesitated to become involved in joint ventures with other countries. For example, the K-8 jet trainer has been developed with Pakistan while the P120L light helicopter is being developed as a joint venture with Aerospatiale and Singapore Aerospace.
However, an earlier collaborative venture with Deutsche Aerospace to produce the MPC 75 family of airliners did not reach fruition ? largely because the expected boom in regional airliner sales was overtaken by the economic recession.
Nevertheless, this is the age of partnerships in aviation, if for no other reason than few single companies (or countries) can afford the development costs of new aircraft. Reports that Hindustan Aeronautics Limited (HAL) plans to enter the regional jet airliner markets indicate that it is seeking a partnership with other Asian countries ? including China.
The trend towards international partnerships in aircraft manufacturing is undeniable and China is well-placed to take advantage of this development because it now has experience in manufacturing to both Russian and Western standards and has an expanding domestic market for airliners of all sizes.
However, it is not only in aircraft manufacture that partnerships are being formed ? as the recent agreement concluded between CATIC and Lucus testifies. This will result in the development of a repair, overhaul and manufacturing facility in China which initially, will concentrate on handling engine fuel systems, but will go on to manufacture hydromechanical and electronic systems.
In another and quite different field, TRO Learning opened an office in Beijing to support its airline customers in the Asia /Pacific region as well as in China itself. TRO is supplying hardware and courseware for pilot training but is not without competition from
Wicat Systems which also 9 penetrated the market.
Indeed China has a record of spreading orders among a wide range of Western aircraft, engine and other aviation-related suppliers. This ensures that no single manufacturer achieves a dominant position, while the opportunity is taken to keep abreast of technical development in the principle centres of advanced technology.
That China has its own contribution to offer is evident from the number of joint ventures that are slowly getting underway. Political and economic stability are key requirements for this trend to continue. *
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