Boeing yesterday signed US$600 million worth of contracts with Chinese companies for the production of commercial airplane components.
Deals included the first-ever confirmed agreement to produce parts for the brand new Boeing 787 Dreamliner.
Boeing finalized contracts for the 787 composite rudder, the 737 forward entry door, and the 737 automatic over-wing exit door with the Chengdu Aircraft Industrial (Group) Co Ltd, an affiliate of the China Aviation Industry Corporation I (AVIC I).
Also sealed was the deal for the 787 wing-to-body fairing panels with the Hafei Aviation Industry Co, Ltd, part of the China Aviation Industry Corporation II (AVIC II).
"AVIC I is keen to further its long-standing partnership with Boeing. While strengthening our own aircraft building capability with the ARJ 21 feederliner project, we hope to grow into a global supplier for the international aircraft manufacturing industry," Liu Gaozhuo, president of AVIC I, said.
Liu added that becoming the sole partner for components supply with Boeing on the revolutionary 787 project was an endorsement of China's aeronautics technology and manufacturing capability.
"Since large amount of new composite materials are used in the 787 Dreamliner, that imposes a higher demand on us as a components supplier. It is surely a recognition of our technical capability," Liu said.
More than 3,500 Boeing airplanes - one third of Boeing's world fleet - are assembled in China or have major parts that are manufactured here.
Boeing Commercial Airplanes Vice President and General Manager of Airplane Production Carolyn Corvi said that yesterday's agreements showed China's growing role in Boeing's strategy of global manufacturing and production outsourcing on the 787, 777, 747 and 737 airplane programs.
"China's aviation industry is providing outstanding technological capabilities and resources that help us meet quality, cost and delivery imperatives in our programs - particularly on the new 787 project," she said.
Agreeing with Corvi, David Wang, president of Boeing China, said it was natural for aircraft manufacturing to be a global industry, instead of being limited to a single territory.
Because China boasts manufacturing facilities and a cheap, educated workforce, it makes sense for both Boeing and Airbus to shift some production into the country, Liao Quanwang, deputy director of China Aviation Development Research Center, said.
Airbus, Boeing's main rival, has pledged to offer a 5 percent risk-sharing partnership with China in its newly unveiled A350 project.
Both AVIC I and AVIC II disclosed that they were in negotiations with Airbus on the A350 program. Deals might be concluded by the end of this year, Xu Zhanbin, vice president of AVIC II, said.
Other contracts include a memorandum of agreement between the Shenyang Aircraft Corporation, an AVIC I-affiliated company, and Boeing signed yesterday for the construction of the 787 assembly for its vertical fin.
BHA Aero Composite Parts Co Ltd signed memoranda of understanding to supply interior panels for the 777 control cabin, as well as wing-to-body fairing panels and the tail cone for the Next-Generation 737 series. BHA is an equity-share joint venture between Boeing, Hexcel Corp and AVIC I.
(China Daily June 3, 2005)
