Watch out, Boeing: China’s aerospace giant faces first real test as it delivers aircraft to major Chinese airlines

Jun 29, 2020

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Commercial aviation is run by a duopoly, with plane makers Boeing and Airbus accounting for an overwhelming majority of the market share. These are both western companies, headquartered in the U.S. (Boeing) and France (Airbus), but there’s a new competitor on the scene

After years of development, the Commercial Aircraft Corporation of China (COMAC) celebrated a huge milestone yesterday, when it simultaneously delivered three of its ARJ21 aircraft to China Eastern, China Southern and Air China, the largest airlines in mainland China.

Photo courtesy of COMAC
Photo courtesy of COMAC

The ARJ21 originally entered service in 2016 with Chengdu Airlines, which currently operates 20 of the regional jets. Genghis Khan Airlines operates four ARJ21s and Jiangxi Air has two. Still, the simultaneous delivery of the first ARJ21s to China’s three largest airlines represents a pivotal moment for COMAC as it attempts to compete with larger and more established manufacturers.

The ARJ21-700, the base model of the jet, can seat between 70 and 95 passengers in a 2-3 configuration. The plane has a range of between 1,4000 and 2,300 miles, and is powered by two rear-mounted General Electric CF34 engines, the same type found on most Bombardier CRJ and Embraer E-series jets.

Photo courtesy of COMAC
Photo courtesy of COMAC

Regional jets are not very common in China, where due to the sheer size of the population airlines often fly 777s and 747s on short-haul domestic routes. Prior to taking delivery of the ARJ21, the smallest jets in Air China’s fleet were its 128-seat A319s.

Related: 5 reasons Asia is the best continent for short-haul flying

Since delivering the first ARJ21 to Chengdu Airlines in 2015, COMAC has struggled to ramp up production, delivering just 30 aircraft over the last 5 years. By comparison, Boeing was producing more than 40 737 MAX aircraft a month before it had to suspend production amid the plane’s ongoing grounding.

The ARJ21 has been hampered by delays since the program started in 2002. COMAC originally planned to deliver the first aircraft in 2007 (which would’ve been quite an impressive timeline for a company that had never built commercial aircraft before), but that date ended up slipping by eight years as development was hampered by wing cracks, faulty wiring and problems with the plane’s avionics system.

With 378 orders to date, COMAC appears to be doing quite well with the first plane they’ve ever put on the market. However, the plane has failed to attract large numbers of orders outside of China. Excluding about 25 orders from smaller African and Asian airlines (as well as 20 by GE’s aircraft leasing division), all of COMAC’s orders for the ARJ21 have come from state-owned or controlled Chinese airlines and investment groups. Approximately 25% of the ARJ21’s total orders occurred in August 2019, when Air China, China Eastern and China Southern simultaneously announced that they’d agreed to each purchase 35 ARJ21s for delivery between 2020 and 2024.

Even if the ARJ21 doesn’t become a worldwide success, the experience designing, selling and manufacturing a commercially viable aircraft will aid COMAC significantly with the other jets it has under development. Most important is the C919, COMAC’s single-aisle mid-size jet which would directly compete with the Boeing 737 and Airbus A319/320/321 family. Those smaller single-aisle jets represent the largest segment of the commercial aircraft market, both in terms of number of orders and dollar value.

The COMAC C919 makes its first flight on May 5th, 2017. (Photo by VCG via Getty Images.)
The COMAC C919 makes its first flight on May 5, 2017. (Photo by VCG via Getty Images.)

Since COMAC has yet to prove itself on the world stage, it’s biggest advantages right now are competitive pricing and the ability to lean on China’s state-run economy to drum up orders (and crucial funding). The C919 has 305 firm orders and options over 700 more aircraft, all but 10 of which are from Chinese companies. GE Capital Aviation Services is again the lone exception with a firm order for 10 C919 aircraft and options for 10 more.

Bottom line

It will likely still be some time before COMAC poses a real challenge to the major aircraft manufacturers like Boeing and Airbus. Regional jets are an odd fit for China’s large and growing aviation market, but that hasn’t stopped state-owned and controlled airlines from placing orders for hundreds of ARJ21s and C919s. While the ARJ21 has technically been in service for a few years now, yesterday’s simultaneous delivery to China’s largest airlines represented a turning point, and an important test, for COMAC.

Photo by Liu Zhankun/China News Service via Getty Images.

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