GLOBAL AVIATION INDUSTRY REVIEW: CHINA VS. THE US IN A LIVE RBC REVIEW
« BackAnton Koren, General Director of the Transport Strategy Center (TSC), spoke live on RBC: a forecast for the development of the trade war between China and the United States in connection with the planned introduction of an additional 100% tariff on imports of goods from China.
🔹 The first aspect is the supply of aircraft to the United States – the number one export item, one of the leading items, and aircraft have always generated the largest amount of export revenue for the US treasury compared to other products. The Chinese market is one of the largest in the world, so the likelihood that businessman Trump will cut off the branch on which the American aviation industry relies is low. However, the unfolding flywheel of mutual growth could lead to China itself suspending aircraft supplies from the United States.
🔹 The second strategic aspect is that Chinese civil aviation is largely dependent not only on American Boeing, but also on European Airbus.
Moreover, unlike Boeing, Airbuses are assembled in China on the final assembly line. More than 700 A320s have already been assembled in Tianjin. These aircraft leave the factory in China and immediately enter the fleets of Chinese airlines, among others. China's strategic partnership with European airlines allows for the complete replacement of Boeing with Airbus. These are direct substitutes.
China is currently the largest domestic market for European Airbus. The Airbus fleet in mainland China exceeds 2,200 units, accounting for approximately 55 percent of the Chinese market.
🔹The third aspect is its own domestic aircraft industry, its own production.
China's mainline C-919, with 174 passenger seats depending on the cabin configuration, is American-made in most respects. Only the tail and wing are Chinese-made, while the engines, fuel system, aluminum fuselage components, landing gear, brakes, and avionics components are all American-made. Of the previously planned 70 aircraft per year, only five had been produced by September of this year due to sanctions pressure and total dependence on American suppliers. Without a partnership with Russia, independent import substitution will be impossible in the coming years, and C-919 aircraft will become rare.
🔹 China also has 90-seat ARJ-21 aircraft, which represent China's first step in mass production of civilian jetliners. China, like Russia with the Superjet, has produced around 200 of these aircraft, but they are also completely dependent on the US for engines and avionics. Therefore, it makes tactical sense for the Chinese to collaborate with Europeans on Airbus supplies and assembly, while strategically developing their own aviation industry is better, of course, in cooperation with friendly Russia.
🔴 Details in the video.
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