Chicago-based Boeing has plans for a joint venture maintenance centre in Shanghai in which it will hold a controlling stake, but will not actually make aeroplanes in China.

So said a senior official from the company yesterday.

The US aircraft manufacturer will continue to buy components from Chinese suppliers, added Rob Laird, vice-president of China sales for Boeing Commercial Airplanes.

"China is part of our global supplier network. These are business decisions made based on cost, quality and the capability of the supplier," said Laird. He declined to reveal whether Boeing would increase its purchasing in China in the future.

China makes parts for the B737, the B747 and the new B787 Dreamliner. It is also a key modification, test and certification centre for Boeing's 747-400 passenger-to-freighter conversion programme which was launched in January 2004.

Last year Boeing's European rival Airbus announced plans to build aircraft in China. Airbus is now choosing where to assemble its A320 planes. Tianjin, Shanghai, Xi'an in Shaanxi Province and Zhuhai in Guangdong Province are contenders.

Laird confirmed that Boeing will set up an aircraft maintenance, repair and overhaul (MRO) base in Shanghai.

"We are continuing to make sure we get all the business approval that is required. We expect that will happen here very shortly," Laird said.

In December Boeing officials told China Daily that the MRO joint venture would be established in the first half of this year. Boeing will reportedly invest more than US$100 million into what will be the first foreign-controlled MRO facility in China. Shanghai Airlines and Shanghai Airport Authority will hold the rest of the shares.

Laird was speaking after Boeing signed a general purchase agreement with the China Aviation Supplies Import and Export Group for 80 B737s. The planes, worth US$5.2 billion according to the catalogue price, will be delivered to eight Chinese airlines between 2009 and 2010.

Boeing received 120 orders from China last year.

"With the 80-aircraft order and an additional 20 booked in January, we are well on our way to achieving the same volume as we did last year," Laird said. "We hope to maintain our market share of 60 to 65 percent in China."

(China Daily April 13, 2006)