On Friday, China’s Ministry of Industry and Information Technology and the National Natural Science Foundation agreed to move capital into a joint fund for aircraft research. The authorities did not disclose the size of the fund, but industry insiders have made low-end estimates of several billion yuan.
Filling its airspace with its own planes and reducing foreign sourcing for advanced components like engines and avionics have been decades-long priorities for Beijing, and the launch of the C919 under the state-owned Commercial Aircraft Corporation of China (Comac) was a milestone moment in the pursuit of those goals.
“The fund’s focus on basic research can be a sign Beijing has realised that, even with the launch of the C919, China needs to lay a more solid foundation … to close the gap with the West in making bigger jets,” said Li Hanming, an aviation analyst and founder of a transport consultancy which operates in the United States.
“It’s a whole new level if you aim to progress from the C919 to bigger models with comparable capabilities to [Boeing’s] 787 and 777 or [Airbus’] 350 and 330 series,” he added.
At last week’s launch ceremony, minister of industry and information technology Jin Zhuanglong said the fund will identify the realms where its help is most needed. State media, meanwhile, touted the fund’s creation as a move serving national strategic needs.
03:44
China’s home-grown passenger jet C919 celebrates first anniversary of maiden flight
China’s home-grown passenger jet C919 celebrates first anniversary of maiden flight
While considerable, the new fund is not unprecedented. The US and Europe operate similar state-led bodies for their own aviation industries, Li said, and China has had a separate research grant backed by state-owned conglomerate Aviation Industry Corporation of China (AVIC) since 1985.
However, the establishment of the fund could indicate Beijing intends to take a more active role in the industry, as the capital needed for making the dream of flying advanced widebody jets into reality can be astronomical.
“The design, production and subsequent operation of any new aircraft is a very expensive and complex business requiring huge levels of working capital,” said John Grant, founder of the London-based JG Aviation Consultants.
If the challenges [launching the C919] were difficult, then for this project you could multiply them tenfold
“The issue for China is that it does not have widebody aircraft comparable to its market demand, and getting places on the production schedule is very difficult … Deciding to design more aircraft models on its own is a step few countries could take.”
Grant added that while Beijing foots the bill for the lengthy, costly process of research and development, it needs to bear in mind the marketability of Chinese widebody jets at a time when overseas commercial prospects would be far from certain.
“Ultimately this will probably be a very expensive exercise that will end up with a few new aircraft types that look similar to [China’s] old wide-bodied aircraft that got no [international] sales. If the challenges [launching the C919] were difficult, then for this project you could multiply them tenfold.”