China eyes aero­space mar­ket with new firm

The Myanmar Times - - International Business -

CHINA of­fi­cially launched a new multi-bil­lion-dol­lar jet en­gine con­glom­er­ate with al­most 100,000 em­ploy­ees at the weekend, as Bei­jing seeks to be­come an aero­space power and com­pete with the likes of Rolls Royce and Gen­eral Elec­tric.

The Aero En­gine Cor­po­ra­tion of China (AECC) has reg­is­tered cap­i­tal of 50 bil­lion yuan (US$7.5 bil­lion), and re­ports said it would in­cor­po­rate sub­sidiaries of a se­ries of state-owned firms, in­clud­ing the Avi­a­tion In­dus­trial Corp of China (AVIC).

Pres­i­dent Xi Jin­ping said found­ing the com­pany was a “strate­gic move” to make China an avi­a­tion power and mod­ernise the mil­i­tary, the of­fi­cial Xinhua news agency re­ported.

China does not make large com­mer­cial jet en­gines of its own and the coun­try’s nar­row-body air­liner, the C919, is pow­ered by en­gines from CFM In­ter­na­tional, a ven­ture be­tween GE and France’s Safran.

The best air­craft in China’s air force use en­gines built in Rus­sia. Bei­jing is look­ing to change that with the cre­ation of a new na­tional cham­pion in the field as it seeks the pres­tige of hav­ing its own avi­a­tion sec­tor.

Lead­ers have tar­geted the man­u­fac­ture of high-tech­nol­ogy prod­ucts such as jet en­gines as a means to trans­form the world’s sec­ond-largest econ­omy and make its firms more com­pet­i­tive with ad­vanced for­eign ri­vals in aero­space, biotech­nol­ogy, al­ter­na­tive en­ergy and other sec­tors.

Pre­mier Li Ke­qiang said in writ­ten com­ments that mak­ing “break­throughs” in ad­vanced air­craft en­gines would have great value in strength­en­ing the mil­i­tary and man­u­fac­tur­ing abil­ity of the coun­try.

The new firm will em­ploy 96,000 em­ploy­ees and be head­quar­tered in the cap­i­tal, with China’s State Coun­cil also in­vest­ing in it.

But ex­ec­u­tives say it could take years for the firm to de­velop the en­gines to power big com­mer­cial jets.

Ear­lier this year China’s home­grown re­gional jet the ARJ21, made by AECC in­vestor the Com­mer­cial Air­craft Corp of China (COMAC), made its first com­mer­cial flight af­ter years of de­lays, though its qual­ity and re­li­a­bil­ity still have to be es­tab­lished to win over cus­tomer and pas­sen­ger con­fi­dence. –

Photo: AFP

A parked air­craft at the Air­bus Tian­jin plant in Tian­jin. China of­fi­cially launched a new multi-bil­lion dol­lar jet en­gine con­glom­er­ate with al­most 100,000 em­ploy­ees at the weekend.

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