Airbus' A350 program will see 5 percent of its outsourced work
come to China as the world's fastest-growing aviation market will
transition to become a fully-fledged risk-sharing industrial
partner, the European company announced yesterday.
This is Airbus' first strategy announcement regarding China
since rolling out its Power8 restructuring plan last month.
The boon for China's aviation industry is directly tied in to
one of the mainstays of Airbus' new operational model. Namely, it
pledged to outsource half of A350's aerostructure work to a range
of risk-sharing development partners including countries as Airbus
seeks to re-manipulate its costs and risks management. As such, it
is more than doubling the amount of outsourcing given to
collaborators than in earlier programs.
This follows Airbus' 2005 announcement that China would benefit
from up to 5 percent of the A350 program's design and manufacturing
after Airbus launched its Beijing engineering center. The center,
responsible for the design, is 70 percent owned by Airbus, with
China Aviation Industry Corp I (AVIC I) holding 25 percent and AVIC
II claiming the last 5 percent.
Airbus further confirmed that the new announcement had not
changed the original plan.
Laurence Barron, Airbus China president, announced last month
that China would enjoy a steady process of increased integration
into Airbus' industrial organization moving beyond just being a
mere component supplier.
"Despite the management changes in Toulouse, there is absolutely
no change in our strategy in China," Barron said. "We have a
stronger desire to continue our strategies."
The A350 wide-body aircraft will vie to capture back some of the
market dominated by its US rival Boeing's B787 in terms of
long-range, mid-sized, twin-aisle planes. The A350 can seat 270 to
350 passengers while the B787 has 210 to 330 seats.
Since rolling out the B787, Boeing has received 464 orders so
far, with 60 from China. The plane will enter service next year and
will enjoy a five-year hiatus before the A350, with 222 orders so
far, muscles in on its airspace. Hedging its bets, China signed a
letter of intent for 20 A350s last October.
AVIC I and AVIC II will both provide some B787 components,
including the composite rudder and the wing-to-body fairing panels.
Meanwhile the Airbus engineering center in Beijing will increase
its Chinese engineering staff from 105 to 200 by the end of
2008.?
(China Daily March 9, 2007)