China launches company to make big jets

BEIJING — China has created a homegrown company to make large passenger jets, a step forward in the country's quest to become less dependent on Boeing and Airbus.

China Commercial Aircraft was established in Shanghai with registered capital of $2.7 billion, the official Xinhua news agency said Sunday.

It said the central government and the Shanghai government are among the major shareholders, as are China's two main aircraft manufacturing and servicing companies, China Aviation Industry Corp. I and China Aviation Industry Corp. II.

They were split off from state-owned China Aviation Industry in 1999.

China's state broadcaster CCTV said the state-owned Assets Supervision and Administration Commission of the central government had committed $86 million, making it the largest investor.

Europe's Airbus has forecast that China's domestic airplane market will increase fivefold by 2026.

Airbus and rival Boeing dominate the market for commercial airplanes carrying 100 or more people.

Xinhua said Commercial Aircraft will be able to make planes with more than 150 seats.

General manager Jin Zhuanglong said in a Xinhua interview that it was too early to say when a Chinese-developed large jet would be taking off, as it would take a long time to develop homegrown talent and do research.

"According to the development history of Airbus and Boeing, the development and success of civil planes cannot be realized by relying on one or two generations," the executive was quoted as saying.

The company's short-term goal is to help market and sell China's first commercial jet, the 85-seat ARJ21, which has already been developed by China Aviation Industry Corp. I — known as AVIC I — he said.

The jet has yet to make its maiden flight, but AVIC I already has received 181 orders for the ARJ21 from Chinese carriers.

A memorandum of understanding has been signed with U.S.-based GE Capital Aviation Services on a possible order for five jets, which would be the first sale to a major foreign company.