Laurence Barron, President of Airbus China

By Tu Lei

Airbus' cooperation with the Chinese aviation industry will see a major concrete step forward next month, said Laurence Barron, president of Airbus China, on Tuesday  in an exclusive interview with the Global Times.

In October, Xi'an Aircraft Industry Company is to start the A320 Family wing equipping operations in its new factory in Tianjin, and Airbus' latest joint venture (JV), the Hafei Airbus Composite Manufacturing Center, is to be operational in Harbin, said Barron.

The wing equipping, or the so-called phase 4 operation, is expected to start in October and the first set of fully equipped wings will be delivered to the Airbus A320 Family Final Assembly Line China in Tianjin in the first quarter of 2010.

"It's likely to see the first aircraft assembled in China with the first pair of wings completely made and equipped in China in mid 2010," said Barron. That will be the biggest part made in China for Airbus aircraft.

"To have the wings fully equipped in China is an industrially efficient way of working," said Barron. "It saves transportation costs, reduces lead-time and risks in handling, and ensures quicker response time to our customers," he added.

For the Harbin's JV, Airbus holds 20 percent of the total stake and a group of Chinese partners, including Hafei, holds the remaining 80 percent.

"The center will produce major components for the latest A350 XWB program, as part of Airbus' target of manufacturing five percent of the A350 XWB airframe in China," said Barron.

The JV, created in June, will also manufacture composite material parts and components for A320 Family aircraft, according to Barron.

"Airbus delivered its first aircraft to China in 1985 and industrial cooperation began the same year," said Barron.

Currently, six manufacturers are already involved in Airbus aircraft, and the total industry procurement between Airbus and the Chinese aviation industry in 2008 exceeded $100 million.

It is expected to reach $450 million per year in 2015, said Barron.

"For Airbus, China is not only a strategic partner, but also an important market," said the president.

"The global aviation market has not yet recovered, and you cannot say what will happen next winter, but China has performed better than other countries and regions," said Barron.

Last year, Airbus delivered 73 aircraft to China, accounting for 15 percent of its total deliveries. As of August 2009, Airbus has delivered 53 new aircraft from Toulouse, Hamburg and Tianjin to Chinese airlines. "This year, we will deliver around 80 new aircraft to Chinese airlines", said Barron.

According to the airplane giant's website, the in-service airbus fleet on the Chinese mainland reached 514 at the end of August, accounting for 41 percent of all of China's aircrafts each with 100 seats.

"All major Chinese airlines have reported profit growth in the first half of 2009 compared with that of the same period of last year and domestic traffic has grown at about 20 percent," said Barron.

Figures from the Civil Aviation Administration of China show in the first eight months of 2009, domestic aviation profits hit 8 billion yuan ($1.17 billion).

However, the latest prediction from the International Air Transport Association says the losses of the global aviation industry this year are expected to hit $11 billion, $2 billion higher than previous expectations.

In a 2009-2028 global market forecast released Friday, Airbus said the Asia Pacific region will account for 31 percent of global demand, followed by Europe at 25 percent and North America at 10 percent over the next two decades.

The airplane manufacturer's prediction has been echoed by Boeing, which says China will remain the largest market outside the US for new commercial airplanes and is expected to need 3,770 airplanes valued at $400 billion over the next 20 years by 2028.