China launches its first company to make large commercial jets

China has opened an aviation company, backed by the government, to manufacture large commercial jets.This will be the country’s first firm to make large-sized passenger aircraft.

The Commercial Aircraft Corporation of China was launched in Shanghai on May 11, 2008, with a registered capital of 19 billion yuan ($2.7 billion), the website business.inquirer.net quoted China’s official Xinhua news agency as reporting.

“The new company will be responsible for researching, developing, manufacturing and marketing a made-in-China large passenger aircraft,” the news agency added.

China, the world’s second-largest aviation market, is aiming at tripling its fleet of passenger planes and cargo planes to 4,000 by 2020 as the country’s economic growth has boosted demand, according to the country’s General Administration of Civil Aviation.

The Xinhua said China plans to build a 150-seat aircraft by 2020 “to compete with Boeing and Airbus in the global market.”

The Chinese government, China’s two state-owned aircraft manufacturers and a few other state-owned firms have invested in the new aviation company.

The aircraft to be made by the Commercial Aircraft Corporation of China is expected to be ready by 2020. It will be assembled in Shanghai – with the nose, fuselage and tail sections to be manufactured in other parts of the country.

Zhang Qingwei, China’s minister for science, technology and the defence industry, is the head of the Commercial Aircraft Corporation of China.

According to Xinhua, a high-level committee of the State Council, or cabinet, had approved setting up the aircraft manufacturing company in February 2007 in order to develop large aircraft with a takeoff weight of over 100 tons and passenger planes with over 150 seats.

The high-level committee of the State Council, led by China’s Premier Wen Jiabao, was quoted by Xinhua as saying that “the programme to develop large commercial jets as soon as possible was a major strategic decision of the central government and a long-cherished aspiration of the Chinese people.”

However, the State Council cautioned that the “complicated project” carried with it “difficulties and risks.” Reports said that some analysts have asked the new company to seek additional funding from the private sector.

Reports in the state-owned media had earlier suggested that China would need at least 10 years to develop the planes.

Meanwhile, an aviation firm, run by the Chinese government, has already received about 180 orders for a regional jet plane with a capacity of up to 105 passengers. The first of these planes are expected to be delivered late in 2009.