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To meet the growing demand of air travel and cargo transportation, airlines in China plan to channel a huge amount of funds to double the handling capacity of their fleet within the next five years.

Gao Hongfeng, vice-minister of the Civil Aviation Administration of China (CAAC), said that mainland Chinese airlines would increase their combined fleets to 1,580 airplanes from the current 863 airliners by 2010.

And by 2025, the fleets can be expanded to 4,000 aircraft, a big jump from around 500 in 2000 in the mainland. "The expectation is based on the robust growth of the domestic travel market," said Gao.

He predicted that the mainland's domestic air travel market will grow by 14 percent annually until 2010, and from 2011 to 2020, the annual growth rate will be around 11 percent.

Twenty-seven airlines on the Chinese mainland last year handled 138 million passengers, up 15.5 percent from the previous year. There has also been an increase of 3.06 million tons of cargo, up 13.8 percent of the same year.

Airplane giants Boeing and Airbus are also upbeat about China's purchasing ability in aircraft in the coming years. Boeing predicts China will need 2,600 new airplanes over the next two decades, which will be worth approximately US$213 billion.

And by 2024, China's fleets will have 3,200 airplanes in service, according to Boeing, whose estimate is lower than CAAC's 4,000 by 2025.

George Liu, Boeing China's vice-president of communications, told China Daily that Boeing's goal is to keep its market share in China for many years to come. As of December 2005, 542 or 61 percent of the 888 commercial jetliners operating on the Chinese mainland were Boeing airplanes.

Vice Premier Wu Yi signed the Chinese order in early April for 80 Boeing 737s (worth US$5.2 billion). The company's China operation executives are still trying to sell more to match, and hopefully exceed, its last year's record of 120 aircraft. Boeing's 2005 sales in China were around US$11.8 billion.

He said 12 percent of the company's 2005 global sales would grow. "China is and will remain Boeing's most important and largest overseas market for years to come and that will create more quality jobs for American designing engineers, test pilots and assembly line workers," Liu said.

The company's next step in its China sales campaign, Liu said, is to "pitch in the efforts to offer more twin-aisle and long-range aircraft to Chinese airlines."

A CAAC report released at the end of 2005 also predicted China would need to purchase new long-range, twin-aisle aircraft as it became a destination for a growing number of international travelers. Moreover, Chinese people were taking more frequent overseas trips, said the report.

Boeing's rival Airbus, based in Toulouse, France, also believed in the great market potential of big aircraft in China.

A report offered by Airbus China's communication department cited that China needs at least 200 large airplanes such as the 555-seat Airbus A380, the biggest passenger aircraft to date, in the next 20 years.

China Southern Airlines has already ordered five A380 aircrafts, which are to be delivered by the end of 2007. These have been ordered ahead of the 2008 Olympic Games in Beijing and the 2010 World Expo in Shanghai.

In addition, Air China, China Eastern Airlines and other carriers are upgrading and expanding their fleets of Airbus and Boeing.

Airbus has steadily ramped up its fleet in China with a market share increasing from 7 percent in 1995 to 34 percent in 2005. But its US rival, Boeing, still holds most of the rest of the market. "We aim to dominate half of China's market by 2013," the Airbus report said.

(China Daily May 6, 2006)