Europe’s largest aircraft manufacturer Airbus started construction today on a new facility to deliver wide-body planes in China, as it faces off against bitter US rival Boeing for market share in the world’s second-largest economy.
At a ceremony in the northern port of Tianjin Airbus CEO Fabrice Bregier and Chinese officials officially broke ground for the completion and delivery centre that will deliver two A330 planes per month.
The new centre is its first such facility for widebody aircraft outside Europe, and “marks a new milestone for Airbus’ international footprint”, Bregier said.
It will take flyable unpainted aircraft from their headquarters in Toulouse, France and add cabins, furnishings, and paint, before they are delivered to customers.
The centre is an expansion of the firm’s existing final assembly plant for A320 single-aisle aircraft in the city.
China’s economic growth slowed to its weakest in a quarter of a century last year and concerns over its outlook have sent shivers through global stock exchanges, but Bregier said that “this is not true for our market”, adding that increased middle-class incomes and easing visa rules were driving a boom in air travel.
The world’s second-largest economy is already Asia’s biggest aircraft buyer as a growing middle class takes to the skies in ever-increasing numbers. The country is forecast to have 1.7 billion air passengers by 2034, and is poised in the next two decades to become the largest civil aviation market in the world.
Boeing also plans to open a completion centre in China, it announced last year. The company sold 300 aircraft worth a record USD 38 billion during President Xi Jinping’s visit to the US in 2015.
The two firms have been in a fierce battle for market share in China, where Airbus has gone from 27 percent in 2004 to roughly 50 per cent today, it said.
“I understand that our competitor is trying to mimic” the Airbus strategy by opening a facility, CEO Bregier said in Tianjin, but added: “It’s not really state-of-the-art.”
China is Airbus’ largest market, accounting for nearly a quarter of planes delivered in 2015. Days before the ground-breaking, Air China announced orders for 12 wide-body planes for USD 2.9 billion.