China launches homegrown jumbo jet manufacturing company

China established a homegrown company Sunday to make passenger jumbo jets - a step forward in the country's quest to become less dependent on Boeing and Airbus.

China Commercial Aircraft Co. was established in Shanghai with registered capital of 19 billion yuan (US$2.7 billion; euro1.75 billion), the official Xinhua News Agency and state broadcaster CCTV said.

Europe's Airbus has forecast that China's domestic aircraft market will increase fivefold by 2026. Airbus and Chicago-based rival Boeing dominate the market for commercial airplanes carrying 100 or more people.

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

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, which were split off from state-owned China Aviation Industry Corp. in 1999.

The state-owned Assets Supervision and Administration Commission committed 6 billion yuan (US$86 million; euro55.6 million), making it the largest investor.

Given China's limited experience with making commercial airliners, manufacturing jumbo jets would be a significant achievement. China's first commercial jet, a 85-seater developed by China Aviation Industry Corp. I, had its maiden flight postponed last month until later in the year because of delays in the delivery of key components.

China Commercial Aircraft general manager Jin Zhuanglong said in a Xinhua interview that it was too early to say when a Chinese-developed jumbo jet would be taking off, as it would take a long time to develop talent and conduct 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," he was quoted as saying.

China welcomes cooperation with foreign companies and will make full use of foreign technology in developing its aircraft, Xinhua quoted him as saying.

The company's short-term goal is to help market the 85-seat ARJ21, he said.

Chinese carriers have already ordered 181 of the planes. A memorandum of understanding has been signed with GE Capital Aviation Services on a possible order for five jets, which would be the first sale to a major foreign company.