Ever since the Commercial Aircraft Corporation of China (COMAC) presented the C919 in January 2009, comparisons with the Airbus A320 and Boeing 737 aircraft families have followed the Chinese narrow-body. Rightfully so, as the trio of aircraft are competing for the same market space, carrying between 160 and 180 passengers on short-to-medium-haul itineraries. Comparisons only increased as Airbus announced the A320neo and, subsequently, Boeing announced the 737 MAX.
China is an aviation market like no other country, not only in terms of its projected growth in passenger numbers but also the way that the government plays a role in it. With the authorities spearheading various projects and prioritizing homemade technology, the competition for the largest aviation market between the A320neo, the 737 MAX and the C919 might be skewed towards the Chinese narrow-body jet – which begs the question, does the C919 even need to compete against the two Western-made single-aisle aircraft?
At the same time, if the tightly-controlled market is being skewed towards locally-made products, why would Airbus and Boeing compete?
The answer perhaps lies in the market outlooks that the two manufacturers have provided.
According to Airbus Global Market Forecast (GMF), the manufacturer predicted that China alone would need 7,400 new aircraft between 2018 and 2037. Out of that number, the country will require around 6,100 typical narrow-body aircraft, with an additional 870 smaller wide-body or long-range single-aisle aircraft. All in all, the European manufacturer indicated that demand from China would represent 19% of the total demand for new aircraft in the 20-year period between 2018 and 2037.
“China is one of the most powerful growth engines of global air transport. It will become the world’s number one aviation market in the very near future,” stated Airbus Chief Commercial Officer (CCO) Christian Scherer in November 2018. While the world was much different back then, including no pandemic to create the worst travel demand in history, according to International Air Transport Association (IATA), the future demand for aircraft is believed to remain more or less the same in China.
Boeing’s newest commercial market outlook aims to confirm that belief. The US planemaker outlined that despite the COVID-19 induced crisis, “China has demonstrated a relative advantage compared to other countries in its economy’s ability to recover,” read the market outlook, published in October 2020.
“The largest domestic market is advantageous to Chinese carriers, helping them rebound more quickly than airlines in other countries,” concluded Boeing. Overall, the manufacturer predicted that the country would need around 6,450 single-aisle aircraft, in addition to 380 regional jets and 1,590 wide-body planes. Globally, Boeing expects that airlines will require 32,270 single-aisle aircraft. As a result, in the next 20 years, China is predicted to take around 20% of the total single-aisle deliveries.
Thus, the duopoly will not only compete against one another but also against the C919. COMAC intends to finally deliver the narrow-body in late-2021, despite the fact that the Civil Aviation Administration of China (CAAC) has yet to certify the aircraft.
Airbus and Boeing position in China
Both members of the duopoly have established their own major facilities in the country.
Airbus opened its Final Assembly Line (FAL) in Tianjin, China, in 2008. At first, the assembly line was capable of delivering the Airbus A320 family aircraft. Since 2017, the site also has also welcomed an Airbus A330 Completion and Delivery Centre (C&DC), and in Q1 2021, the Tianjin facility is scheduled to deliver an A350 from the C&DC.
“China will become a very important strategic market for Airbus,” George Xu, the Chief Executive Officer (CEO) of Airbus China was quoted as saying in October 2020. A year prior, Airbus and Chinese officials signed the deal to increase the manufacturer’s presence in the country, including the inclusion of the A350 into the C&DC, when the French President Emmanuel Macron visited China in November 2019.
Meanwhile, Boeing delivered its first and only 737 MAX from its Zhoushan, China Completion and Delivery Center to Air China in December 2018. Established together with COMAC, the facility was limited to work on the 737 MAX’s interior at the time of its first delivery, with the main assembly work in Renton, Washington, United States.
AeroTime News approached Boeing and the company’s representatives in Zhoushan for a comment on the facility’s current status and future.
However, China was also the first authority to ground the Boeing 737 MAX following its second fatal crash in Ethiopia in March 2019. While authorities across the globe, including the United States Federal Aviation Administration (FAA), have begun to unground the aircraft, China’s CAAC is in no hurry to do so. The authority’s director Feng Zhenglin noted that in order for the aircraft to be allowed to fly commercially in the country once again, it would have to meet three conditions. First things first, the CAAC needs to certify the changes, followed by pilots receiving proper training and finally, the authority indicated that effective changes needed to be made to rectify errors found during the two fatal accident investigations.
“Based on these three principles, we have not set a timetable for Boeing 737 MAX’s return to service here. As long as these conditions are met, we’re happy to see the MAX return to service in China,” Feng was quoted as saying by Reuters in October 2020. A month later, industry sources indicated that the 737 MAX could return as soon as March 2021, according to AviationWeek.
At the same time, all three single-aisle aircraft, including the manufacturers behind them, are entangled in political quarrels, with outcomes sliced with double-edged knives.
Much like the CAAC is in no hurry to release the 737 MAX into service, the US was in no hurry to allow COMAC to make progress in its plans. Shortly before the former US President Donald Trump was set to leave the Oval Office, he added several Chinese companies to a blacklist of companies that have alleged ties to the Chinese military, including COMAC. US individuals are prohibited from investing in blacklisted companies, however, that should not come as a threat to the manufacturer as its shares are not publicly traded in the US. A problem would arise if COMAC were to be added to the Entity List, which the Bureau of Industry and Security (BIS) described as a list of entities that are “subject to specific license requirements for the export, re-export and/or transfer (in-country) of specified items.” If COMAC were added to the list, the suppliers would have to obtain special licenses from the BIS to conduct business with the Chinese company.
With US-based manufacturers, including CFM International, Rockwell Collins and Honeywell providing such parts as the engines, avionics and flight controls, respectively, to the C919, COMAC’s addition to the Entity List could delay the narrow-body for a long time. Fortunately, the newly-sworn in US President Joe Biden indicated a change of tone in terms of international relations between the two countries.
“I’m not going to do it the way Trump did. We are going to focus on the international rules of the road,” stated Biden in an interview with CBS. Still, the US was preparing itself for “extreme competition” against China, added the 46th President of the US.
Nevertheless, subtle hints of politics could follow the C919 throughout its operational history.
“There is clearly an element of airlines being “asked” to take the aircraft as quite frequently, those same airlines are “asked” to take Airbus or Boeing aircraft as part of much larger trade deals,” commented to AeroTime News John Grant, chief analyst at OAG. “That is where COMAC may play a role in the soft politics of aviation with perhaps African nations seeking Chinese investment and support taking the aircraft for their national carriers to operate,” he added.
According to the analyst, it is highly unlikely that the C919 would dent either the A320neo or the 737 MAX market share, especially on the international stage. While some opportunities could follow due to the aforementioned political soft power, COMAC aircraft “lack that market confidence outside of China,” added Grant.
“In performance terms – payload-range and operating economics, I have no doubt that on paper the C919 can look competitive compared to Max and A320neo. However, there is always a third leg to the stool of any successful aircraft program and that is manufacturer and product support,” in a comment to AeroTime News explained Rob Morris, Global Head of Consultancy at Cirium. “Airbus and Boeing have spent 50 years building worldwide and word class customer support networks and each continues to innovate and support their operators and customers today. Of course, there are always things each could do better but they have built trust globally which enables them to continue to sell aircraft in high volume,” continued Morris.
“By contrast, COMAC has no track record and indeed a history of development delays with both ARJ21 and now, the C919, which means the market has not yet built that trust.”
Seemingly, the A320neo, B737 MAX and C919 trio can co-exist, yet at the same time, the Western-made aircraft would still outrun the Chinese narrow-body in China.
“Cirium Fleet Forecast predicted deliveries of around 500 C919 over the next ten years, virtually all of which we expect to be for customers in China. During that same period we are forecasting around 5,500 737 Max and 6,300 A320neo family deliveries globally, including 1,300 and 1,200 respectively in China,” added Morris. Despite the fact that the C919 has great opportunities in its domestic market, “we still expect Airbus and Boeing to dominate the market in China for a long while yet.”