Plane maker gears up for Boeing deals
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A leading civil aviation company said Thursday that it hopes to have more deals with Boeing, which has more than half the market in China.
"Our production of the nose section meets global standards, and we hope to be the supplier for Boeing," said Chen Liangju, general manager of AVIC CAC Commercial Aircraft, Thursday.
Chengdu Aircraft Industrial Corporation (CAC) is a subsidiary of AVIC, Aviation Industry Corporation of China. It is also the only nose section producer for ARJ, a regional jet designed and produced by China.
Our aircraft subcontracts last year totaled $70 million and are expected to hit $200 million by 2015, said Chen, adding Boeing projects will exceed $60 million by 2012.
"It is good to see more producers trying to get in on these deals," Feng Fuzhang, an aviation-manufacturing analyst with CITIC Securities, Thursday told the Global Times. He warned that China's technology still lags behind other countries, such as Japan, which does design, the subcontracts with the highest payouts.
China is still the low man on the totem pole of global aviation manufacturing, Yang Chunsheng, deputy general manager from the subcontract department with AVIC international, said in November last year, according to Economic Information Daily.
Currently, the aviation subcontracts only total $600 million in China, compared with $10 billion in Japan and $28 billion globally per year, according to Yang.
"Without advanced technology, it is hard to earn profits," said Feng at China Securities.
Chen from CAC said profits from last year subcontracts were six percent but will drop because the yuan rose.
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