AIRBUS FORGES CLOSER TIES WITH CHINESE PLANE MAKERS

AIRBUS FORGES CLOSER TIES WITH CHINESE PLANE MAKERS

Europe's aggressive aviation consortium is forging closer ties with China in an attempt to gain low-cost components and open the door to more sales.

Airbus Industrie signed contracts last week with two Chinese aircraft manufacturers for ground equipment and emergency exit doors.The contract to produce molds and maintenance tools for A320 and A330/A340 models is the first overseas deal won by Guizhou Aviation Industrial Group in southwestern Guizhou province.

Shenyang Aircraft Corp. in the northeast signed up to produce 300 emergency exits for A319s and A320s. This is an extension of a 1986 contract for 300 doors, of which 170 have been delivered.

The Shenyang firm also produces wing ribs for the A320, jigs for the A300 and machine parts for the A310.

Airbus - a consortium of German's Daimler-Benz AG, British Aerospace PLC, Aerospatiale SA of France, and Construcciones Aeronauticas SA of Spain - is pushing hard to expand its presence in China.

Boeing Co. of Seattle is the market leader. McDonnell Douglas Corp. of St. Louis is second or third after Airbus, depending on type of plane. The two U.S. companies have extensive manufacturing plants in China, with Douglas producing entire aircraft at Shanghai.

The European group, which recently began work on a $50 million training and service center with state-owned China Aviation Supplies Corp., reckons it has 37 percent of the Chinese market for widebodied models.

Airbus is now pushing its single-aisle models such as the A320. It recently signed a contract to lease three of those to newly established Sichuan Airlines in the southwest.

Based on 9.7 percent air transport growth by 16 Chinese airlines, Airbus recently suggested that China will need 1,320 new passenger planes by the year 2014.

The Airbus forecast says 750 of the new planes will be widebodies and the rest single-aisle models.

It sees the Chinese air cargo sector growing 14 percent a year for the next decade, after rising 17 percent annually between 1985 and 1993.

Total air cargo is about 830,000 metric tons (915,000 short tons) a year, but that is less than 1 percent of the country's overall freight traffic. Airbus and the other manufacturers see some potential for growth.