The C919 Takes to the Skies 挑战波音空客:中国大飞机胜算几何?

The C919 needs another five years to obtain its airworthiness certificate before it can be regarded as a success in terms of technology and safety. Whether it can succeed in the market is a different question. 

By staff reporters Chen Liang, Han Shulin, and Shi Zhiliang

The whole nation rejoiced over the success of domestic large aircraft C919’s maiden in May. Large planes have huge commercial value on their own; moreover, they can prop up an industrial value chain worth trillions of yuan. 

The aviation industry, which represents a nation’s high-end manufacturing capacity, is protected by high barriers to entry. During the development of China’s large aircraft, there was no case of all-round technology importation. It could not go through the process experienced by high-speed rail and nuclear power, which was characterized by large-scale introduction of foreign technologies followed by digestion, absorption, and secondary innovation. Nor did it learn technology through the establishment of joint ventures, like the automobile industry had done. Homemade large aircrafts have taken a completely different path of indigenous innovation: it achieved success marked by the maiden flight of a trunk-line single-channel passenger plane by drawing on the experience of military aircrafts and feeder-liners, trying manufacturing based on client-supplied designs, and military and civilian integration. 

During this process, the main driver of the project － the Commercial Aircraft Corporation of China, Ltd.’s (COMAC) － rebuilt its research and development (R&D) platform, formed indigenous design capability, and developed processing specifications for the manufacturing of civil aircrafts. 

The C919 needs another five years to obtain its airworthiness certificate before it can be regarded a success in terms of technology and safety.

As for business success, the market will have the final say. Will China become the third pole (the incumbents being the U.S. and Europe) in global aviation manufacturing? Chinese people look forward to this. However, given COMAC’s inexperience at customer services and lack of control over the supply chain, fulfilling its verbal contract for 600 aircrafts will not be easy.

From Yun10 to C919

Yun10 played an important role in the history of domestically-made large aircraft. The R&D of Yun10 dates back to August, 1970, about the same time as the beginnings of Airbus.

Yun10’s maiden flight took place successfully after 10 years of R&D, a milestone in the development history of domestic aviation. However, hampered by various factors including funding, marketing, and technology, the Yun10 project was stopped in 1985; meanwhile, Airbus continued to grow. 

In March 1985, Shanghai Aviation Industrial (Group) Co., Ltd, China Aviation Supplies Holding Company, and McDonnell-Douglas Corporation signed an agreement which stipulated that McDonnell-Douglas Corporation would provide large-size components and fuselage components for 25 units of MD-82 aircrafts, and Shanghai Aviation Industrial (Group) Co., Ltd would assemble, carry out test flights, and deliver the aircraft in accordance with drawings provided by McDonnell-Douglas.

Through cooperation with McDonnell-Douglas, China began to learn about the U.S. Federal Aviation Administration’s (FAA) strict airworthiness certification system.

The development of domestically-made civil aircrafts stalled once again after the tie-up with McDonnell-Douglas ended. The domestic civil aircraft industry did not get another jump-start until November 2000, when the new turbofan feeder liner ARJ21 project began. The R&D, production, and certificate-obtaining process of RJ21 reshaped the domestic civil aircraft’s manufacturing system.

In the history of Chinese aviation, ARJ21 has become the first iconic breakthrough product that really targets the civil aviation market. It is not that China is unable to build aircrafts. In fact, the R&D system for military aircrafts has never stopped moving forward. But compared with military aircrafts, civil aircraft have higher requirements for product safety and economic efficiency. Additionally, civil customers and military customers have different needs.

ARJ21

For one thing, military aircraft are built for the military system, which stresses tactical and technical indicators, often with only a few dozen top-level requirements. Civil aircrafts, however, are built for airliners, whose requirements are stipulated down to every level of manufacturing. The C919, for instance, has more than 2000 requirements. 

Additionally, no domestic aircraft before ARJ21 has ever passed the complete airworthiness certification process.

The Civil Aviation Administration of China (CAAC) accepted ARJ21’s application for a model certificate in March 2003, and issued the certificate in December 2014. This is a lengthy process with twists and turns for both the applicant COMAC and the CAAC, which is responsible for the review. Large amounts of experience were accumulated concerning the design and verification of airworthiness compliance. After the maiden flight of the C919, COMAC Deputy General Manager and C919 Chief Designer Wu Guanghui said that ARJ21’s biggest contribution was that it guided the way for C919.

Indigenous Innovation: True or False?

The platform for homemade trunk-line airplanes was rebuilt with the R&D of the C919. An aircraft R&D platform consists of the overall shape including aircraft body, wing, tail, wing hanging, and other components; the aircraft body structure that takes into account weight, aerodynamic, loading, and other factors; as well as a variety of necessary systems onboard including avionics, power, transmission, and software.

Mastering the aircraft’s core technologies is essential to building a platform. COMAC employs a main manufacturer plus suppliers model, which is also used by Boeing and Airbus. C919’s suppliers are spread out around the world. Moreover, key components including the aircraft engine, the flight control system, and the avionics system are provided by overseas suppliers, which has cast doubt on whether the C919 was truly a product of indigenous innovation.

However, building an aircraft is so much more than simply assembling the components provided by suppliers. For a manufacturer, what matters most are its abilities to design aircrafts and to manage suppliers.

The United States explicitly bans any company from helping the C919 with control law design, which is the core technology of the flight control system. In response, COMAC set up a flight control law design team led by Wu Guanghui to overcome this technological challenge, and completed the control law design in about six years.

According to the design, COMAC provides its requirements for algorithms and software to supplier Honeywell; while Honeywell completes software programming, taking into account safety redundancy, reliability, and airworthiness requirements, and produces a specific flight control system in accordance to the requirements of the control law.

It is the same with another core component － the engine. COMAC Chairman He Dongfeng said at the 2017 National Expert Forum on Building Manufacturing Strength that COMAC does not manufacture the engine itself, but it specifies the requirements. The LEAP engine designed by CFM has three models: LEAP-A is for Airbus, LEAP-B for Boeing, and LEAP-C for COMAC’s C919 aircraft. 

In fact, the ability to make demands on suppliers also reflects COMAC’s core technology. It means that the main manufacturer is capable of designing aircraft on its own, and that it knows about the ability of its suppliers and hence can convey its demands correctly for suppliers to meet them. 

Since COMAC is still in its early stage of development, it has less control over suppliers compared with Boeing and Airbus. An expert that understands the manufacturing of engine parts and components told Caijing that at parts manufacturing plants, Boeing and Airbus usually put forward changes in requirements several times in order to meet design requests. In comparison, COMAC makes far fewer changes in requirements. The expert said, “We do not have such negotiating power right now.”

Wang Shunli, head of technological management department of COMAC Shanghai Aircraft Manufacuturing Co., Ltd., summed up domestic large aircraft’s path of innovation to Caijing in this way: R&D of COMAC’s ARJ21 and C919 is integrated innovation based on mastering core technologies and combining components from first-class suppliers worldwide. Going forward, more original innovation is needed to improve the layout and streamlining of the airfoil, and to explore smart manufacturing, cloud technology, and 3D printing. In the supply chain, joint ventures by domestic companies and foreign suppliers will be re-invented after introduction, digestion, and absorption and the JVs will learn advanced concepts and management. Ultimately, they shall move towards integrated innovation and indigenous innovation.

Time will tell whether the huge Chinese market and China’s manufacturing industry can support large aircraft through this path of innovation.

Orders: Are They for Real?

So far, 24 clients have placed orders for a total of 600 units of the C919, but COMAC has received little money. China Eastern Airlines told Caijing that it has ordered 20 units of the basic C919 model from COMAC, among which the order for five units is confirmed, while the order for another 15 units is intentional. By convention, purchasers do not need to pay any fees in advance when signing intentional orders for aircraft buying; nor do they need to pay a penalty if they cancel an order. 

The clients placed orders mainly to support domestic products. Jiang Bo, Global Head of Aviation and Managing Director at ICBC Financial Leasing, told Caijing that “As the biggest domestic leasing company, ICBC Leasing must fully support the development of domestic civil aircrafts. The decision to purchase ARJ21 and C919 is made based on corporate and social responsibilities, not just commercial value.”

With the success of the C919’s maiden flight, market confidence in this model is enhanced.

However, the global trunk-line market is dominated by Boeing and Airbus, with few opportunities left for COMAC.

Boeing 737 MAX and Airbus A320NEO

Growing domestic demand is C919’s only chance to change the landscape of the civil aviation industry. The International Air Transport Association (IATA) estimated in November 2016 that China will replace the United States as the world’s largest aviation market by 2024.

Jiang Bo said, “If the C919 can achieve an actual delivery of 300 units, COMAC could break even on this project. Given strong support from domestic airliners and leasing companies, COMAC has pretty good prospects.”

Using external help to go for the international market is important for COMAC, which is working with ICBC Leasing to develop the overseas market. 

So far, ICBC Leasing has more than 60 customers in 34 countries, nearly 50 of which are foreign. With customers throughout the Asia-Pacific region, Europe, Africa, and the Americas, ICBC Leasing can become a springboard for COMAC’s efforts to go global.  

ICBC Leasing and COMAC have been working together to conduct market research in target markets including Southeast Asia, Africa, Iran, and Eastern Europe since 2015.

Airbus launched its famous “Silk Road” strategy back in 1976, starting from the Far East market Boeing ignored, and gradually broke the monopoly of Boeing. COMAC has a lot to learn from this strategy: how Airbus brok Boeing’s monopoly and opened up the Far East market; how it created a new business model to enter the U.S. market; and how it achieved technological innovation.

Difficulties Faced on the International Market

Despite a variety of external assistance, COMAC has to obtain an airworthiness certificate from the European Aviation Safety Agency (EASA) or FAA for C919 to compete on the international market. The C919 submitted a model certificate application to the EASA in 2016.

Jiang Bo said, “To obtain the international airworthiness certificate, the quality of the product must be good; in addition, a push from the government is needed.”

To this end, when meeting with German Chancellor Angela Merkel in May, Premier Li Keqiang urged Germany to support China’s C919 in obtaining the EU’s airworthiness certificate. Meanwhile, China and the EU have been negotiating a bilateral aviation safety agreement (BASA).

Once an agreement is reached, the C919 only needs to go through technical assessment, testing, inspection, and compliance certification by EASA or CAAC, receiving airworthiness certificate from either party would allow it enter the European market. Without an EASA certificate, the C919 could enter the overseas market by signing bilateral airworthiness agreements with each country. 

Support from local target customers would also help the C919 obtain foreign airworthiness certificates. ICBC Leasing, Thailand Metropolitan Airlines, and COMAC signed a memorandum of understanding in 2015, which details plans to lease C919 to Thailand Metropolitan Airlines through ICBC Leasing. The three parties have also taken action to try to obtain local airworthiness certificate. COMAC is applying the approach used in Thailand to other overseas markets.

In addition to airworthiness certificates, winning market confidence is a prerequisite for COMAC to enter the international market.

Lǚ Yong, Chairman of Ruoer General Aviation Development Group, told Caijing that “The C919 first needs to build a fleet in the domestic market. Only through the continuous flying of a certain number of C919 aircrafts, can COMAC accumulate enough operational and safety data. These data would help COMAC’s civil aircrafts win the confidence of airliners worldwide.”

(Staff reporters Shen Xiaobo and Shen Chen, and intern reporter Shi Chang also contributed to this article.)

Translator: Xiong Jing

Copy Editor: Michele Scrimenti

Chinese Editor: Shi Zhiliang

English Editor: Kang Juan

(This article was originally published in the August 21, 2017 issue of Caijing Magazine.Click "阅读原文” at the bottom to read the original Chinese article.)

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