Last updated: 04:30 PM ET, Mon November 02 2015

Should Boeing and Airbus be Worried about China's New Commercial Plane?

Airlines & Airports | Josh Lew | November 02, 2015

Should Boeing and Airbus be Worried about China's New Commercial Plane?

Photo via Twitter/XHNews

Airbus and Boeing are the two major names in the commercial aircraft manufacturing industry. Yes, there are a few upstarts, such as Brazil’s Embraer and Canada’s Bombardier, but their market shares are quite modest. The two heavyweights don’t have much to fear from these underdog manufacturers. However, there is a new player in the airplane-building game that may eventually change the two-horse race into a three-way contest. 

China builds its first commercial plane

China is entering the fray with a newly unveiled commercial jet called the C919. Built by the government-owned Commercial Aircraft Corporation of China (Comac), the C919 has been in the works for a number of years already. Though it was officially unveiled to the media in Shanghai on Nov. 2, the airplane won’t be taking off any time soon. The C919’s first flight is still a year or more away. However, the unveiling is a significant event for a country that has been trying (and failing) to build a commercial aircraft since the 1980s. 

Despite being billed as a “made-in-China” product, the C919 prototype had a lot of input from non-Chinese companies. CNN has verified the truthfulness of a graphic that has been shared widely on the internet. The image shows that many of the components for the C919 were made in the US, France and Germany. This includes the electrical system and landing gears, both of which were produced in the US by Honeywell. 

Boeing and Airbus primed to meet high demand in the Chinese market

China has already said that it is planning to design other aircraft as soon as the C919 takes off. However, these new planes will most likely not be ready in time to meet China’s huge demand. Now the second busiest commercial air travel market after the US, China will need more than 6,000 new planes within the next 20 years. Both Airbus and Boeing are primed to meet this demand. The government, which either owns or has large stakes in many of the country’s major airlines, has made high profile orders recently: 300 planes from Boeing and 130 from Airbus. Airbus has even opened a plant in Tianjin, China where it assembles its popular A320. 

Even while making commitments to purchase planes from overseas builders, China is bullish about its own manufacturing industry. It already has 500 orders for C919, and projections indicate that it will be able to sell more than 2,000 planes in the next 20 years.

Not quite ready to take on the Top Two 

For now, though, Comac's ambitious goals seem a bit premature. One of the biggest problems is that the C919 is not yet certified by the United States' FAA. This is seen as a major roadblock for international sales, since airlines won’t want to buy planes that aren’t allowed to fly to the U.S.

While Comac could eventually see the C919 and other planes take off after the testing, certification and approval phases, it seems overly ambitious for them to say that they will challenge the dominance of the Big Two any time soon. Even within China, the huge demand for additional commercial aircraft will probably force airlines to place orders with manufacturers like Boeing and Airbus, who can deliver internationally approved aircraft as soon as they roll out of the factory. 

At the same time, Comac has the backing of the Chinese government, so it has an almost unlimited amount of funding to continue the development of the C919. At some point in the future, it may be a source of competition for Boeing and Airbus. But for now, the Big Two probably aren't too worried about competition coming from China. 


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