So far China has spent decades and billions of dollars in its attempts to build a successful commercial aircraft. It hasn’t had much success, likely due to some combination of the complexity of commercial aircraft manufacturing, the reluctance of existing firms to give away their critical technologies, and the leverage foreign governments and organizations such as the FAA and EASA have over China’s aerospace industry. But China seems incredibly motivated to overcome these obstacles and make the industry a success. If it continues to push, there’s a good chance it will eventually succeed.
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Following the Y-10 program, China changed its aircraft manufacturing strategy, formulating a “three-step program." It would first partner with a foreign firm to set up a Chinese assembly operation for an existing, foreign aircraft. Then, China would jointly design and manufacture an aircraft with a foreign firm. This would allow China to obtain foreign aerospace technology and manufacturing capabilities. Once such capabilities had been obtained, China would design and build a large commercial aircraft independently. China aimed to accomplish this by 2010.
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In the 1990s McDonnell introduced the MD-90 series, an upgrade to its MD-80 series, and planned to leverage Chinese manufacturing even more in an effort to beat Boeing in the race for the Chinese market. In what was known as the “trunkliner” program, McDonnell agreed to build 150 MD-90s in China, many of which would be used on major Chinese aircraft routes. Most aircraft components, “essentially everything except the engines and the avionics," would be manufactured in China. But the trunkline program was later scaled back to just 40 planes, only 20 of which would be built in China. Manufacturing and quality control problems meant that only two of the planned 20 airliners were built before Boeing bought McDonnell and canceled the program in the late 1990s.
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By 2010, most Western aerospace firms had established some sort of joint venture in China.
Many of these joint ventures were almost certainly established in the hopes of gaining access to the large Chinese market; Chinese industry leaders have made “no secret of their desire to trade market access for technology,” and increased sales to China often follow the establishment of a joint venture. Boeing, for instance, was historically the dominant aircraft supplier in China; in the mid-1990s, 8 out of every 10 jets flown in China was made by Boeing, and 80% of China’s new plane orders went to Boeing. Ten years later, 2/3rds of new plane orders were to Airbus, and by 2010 Airbus’ market share had risen to 43%, while Boeing’s had fallen to 55%. This shift in fortunes coincided with Airbus establishing an A320 assembly line in Tianjin. Aerospace industry analyst Sash Tush noted that “It’s very hard to escape the conclusion that if you manufacture, if you assemble aircraft in China, you have a stronger market position than if you fly aircraft into China for delivery… This is an industrial policy that Airbus seems to have got very right and Boeing seems to have got very wrong.”
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Because it’s not clear how these trends will play out, there’s a range of different predictions, even from experts, on how the C919 will fare. Aerospace industry experts like Richard Aboulafia and Michael Boyd have voiced skepticism that the C919 will amount to much, while folks like Airbus CEO Guillaume Faury and the head of Dubai Aerospace (one of the largest aircraft leasing companies in the world) appear more optimistic that it will capture at least some market share.
From the article:
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