First China-Built Airbus Due In July

January 30, 2009

China's Sichuan Airlines will become the world's first carrier to receive an Airbus built outside Europe when it takes delivery in July of an A320 assembled in China, an Airbus staff memo said.

Details of the historic delivery, almost four decades after the plane maker was born as a four-nation European consortium, were disclosed to employees in the internal note this week.

It comes as Airbus prepares to sign separate deals with China over investment in its next model, the A350, which will include new carbon materials and will be assembled in France.

Airbus began assembling some of its A320 model of jets in Tianjin near Beijing in September from fuselage parts shipped from Europe.

According to the memo, the Tianjin factory is now full, with four airframes assembled and a fifth in position.

Airbus and rival Boeing have been turning to Asian markets, led by China, for growth as demand weakens at home.

However, China too is now succumbing to the global economic crisis. In December, Beijing encouraged airlines to cancel or postpone 2009 deliveries due to falling air traffic.

Tianjin A320s are assembled from fuselage parts shipped from factories in France, Germany, Spain and Britain. Airbus aims to reach local Chinese output of four A320s a month by end-2011.

Under pressure over jobs, Airbus says Tianjin will serve the Chinese market and that most construction will remain in Europe.

It says the move will lock in a good slice of the 3,000 new planes Airbus predicts China will need over the next 20 years.

But it faces criticism from European unions who say the move adds to outsourcing fears amid the recession and could result in the loss of European technology to a potential jet maker rival.

Airbus has suspended plans to lift total A320-family output to 40 planes a month from 36 due to the global economic crisis.

For now its Chinese production plans remain intact. So if the overall output freeze lingers, assembly of up to 4 planes a month could be transferred to China from Europe. However, with the industry in turmoil due to a drop in air travel, Airbus has said it cannot make firm predictions even for 2009.

Most analysts expect production to be hit everywhere as the recession bites before rebounding on signs of recovery.

Sichuan Airlines, a mid-sized carrier partly owned by China Southern Airlines, operates more than 130 routes, almost entirely within China, with a fleet of 40 jets.

Details of the first Airbus to be made in China emerged as EADS invited China to produce high-tech materials for its next generation of Airbus, the future mid-sized lightweight A350.

A deal to build a plant in Harbin was due to be signed on a visit to Spain by Chinese Premier Wen Jiabao on Friday.

Another deal is expected as he visits Britain on Monday, when Xi'an Aircraft International will sign a parts manufacturing agreement with Airbus, a person familiar with the transaction said.

Spain has a 5 percent stake in EADS, which is controlled by French and German interests with two factories also in Britain.

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