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China has long cherished the dream of flying its own planes. Feng Ru, (1883–1912) – known as Joe Guey Fung or Yue Fong in the United States – was China’s first aircraft designer and aviator. Inspired by the Wright brothers, Feng devoted himself to aircraft manufacturing and flying, first in the United States and then in China. He died in a plane crash at a young age while staging a performance in Guangzhou.
China has developed various types of jets for military purposes. Its major effort at developing a passenger plane, the Yun-10, never went beyond test flights, however. The Yun-10 program was eventually abolished due to lack of funding, as well as the adoption of the “market for technology” strategy, whereby China expected to acquire advanced technology from foreign companies, including in aviation, in exchange for access to its huge market. China ended up doing assembly and supplying components to McDonnell-Douglas, and later Boeing and Airbus. Airbus, which started around the same time as the Yun-10, has become a business success.
As China becomes economically advanced and technologically sophisticated, it is no surprise that it intends to revive the dream of manufacturing a large aircraft. If China is able to make and service such aircraft, it will pose a commercial challenge to Boeing and Airbus, the de facto duopoly in the international civil aviation market.
China’s domestic aviation market is already the world’s largest; the country is expected to require 2,100 to 2,400 passenger planes in the next 20 years with a total value up to US$197 billion. It would not even have to sell its large aircraft overseas for the business to be self-sustaining. Of course, China’s successful execution of the large aircraft program would also have huge implications beyond the aircraft, especially in terms of military applications.
With China’s State-owned Assets Supervision and Administration Commission as the biggest shareholder, the CACC is based on China Aviation Industry Corporation I (AVIC I) and China Aviation Industry Corporation II (AVIC II), the nation’s two biggest aircraft manufacturers. The company will base its aircraft manufacturing program in Shanghai, where the Yun-10 was given birth.
A separate but related military cargo plane program is based in Xi’an, a long-time national defense hub.
As the investment will be huge – the cost of research and development alone is estimated to be roughly 60 billion yuan (US$9 billion) – China will adopt a commercially viable strategy, rather than the traditional top-down and all-inclusive approach, to reinvent its aviation industry. Measures under consideration include investment from local governments and possibly the involvement of private and foreign capital or a public offering. Of course, taking advantage of globalization, the company will surely procure components and services internationally. This will give foreign companies an opportunity to participate in China’s becoming an aviation giant.
Nevertheless, the learning curve will be extremely steep for the CACC to catch up with the entrenched players. It must grasp as quickly as possible new developments in key technologies such as aerodynamics, materials, avionics and engines. One of the problems for Chinese companies that seek to go overseas is low performance in services, and the hurdle for the CACC in this regard will be no less formidable.
The company will use the ARJ-21, a regional jet with a capacity of 80 seats, as a platform for the design and manufacture of its aircraft, as well as a base on which to develop its services and build credibility in safety, reliability and comfort. In the final analysis, the aviation industry is different from the space industry, at which China has been successful (see the previous column “China’s Space Aspirations”) where its success is measured by profitability and market share.
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(Cong Cao is a senior research associate with the Neil D. Levin Graduate Institute of International Relations and Commerce at the State University of New York. He received his PhD in sociology from Columbia University in 1997 and has worked at the University of Oregon and the National University of Singapore. Dr. Cao is interested in the social studies of science and technology with a focus on China. ©Copyright Cong Cao.)
