Both Bombardier (BBD) and ATR-partner, Alenia, announced burgeoning relationships with China Aviation Industry Corporation (AVIC I) at Paris with the Bombardier deal starting with the CSeries and involving significant cooperation on AVIC I’s ARJ21 program in a deal worth $500 million. Meanwhile, ATR is increasing the participation of AVIC I in the manufacturer of the ATR-42 aircraft.
Bombardier
Bombardier and AVIC I announced long-term strategic cooperation on commercial aircraft starting with the 90- to 149-seat CSeries, a decision on which is expected next year. In turn, Bombardier intends to participate in the development AVIC I’s yet-to-be launched, five-abreast ARJ21-900, following on from the ARJ21-700 aircraft. AVIC I expects to launch this year with an expected service entry of 2011, two years before the CSeries, should it be launched.
Bombardier will invest $100 million in the project, provide technical assistance when launched as well as enhance the competitiveness of the ARJ21-900 by exploring potential commonality between it and the CSeries. For its part, AVIC I, in an effort to become a world-class structural supplier, will invest $400 million for research and development as well as the construction of new facilities and equipment for the CSeries.
The new agreement includes AVIC I’s Xian unit, which manufactures components for the Bombardier 415 amphibious aircraft. In addition, it’s Shenyang Aircraft Corporation (SAC) unit supplies components for the Q-Series aircraft and will be a structural supplier on the CSeries aircraft program.
“With the implementation of this agreement, both AVIC I and Bombardier are expected to experience long-term benefits related to the exchange of technical expertise and the expansion of our market potential, both in the higher end of the regional aircraft market and lower end of the mainline market,” said Mr. Pierre Beaudoin, president and COO of Bombardier Aerospace. “For regional airlines, the addition of the ARJ21-900 to the market will complement our Bombardier CRJ family of aircraft. For customers who are looking for a five-abreast regional aircraft with increased range, the ARJ21-900 will be the clear choice over our competition."
“Now, with the implementation of this long-term, strategic cooperation, we will be able to move forward more effectively with our vision to develop the most competitive commercial airplanes,” said Mr. LIN Zuo Ming, president.
The partnership put the CSeries program one step closer to being launched. The two have a well-established history leading up to the recently signed memorandum of understanding to further develop the relationship. The cooperation is expected to yield cost reductions and production efficiencies for the two programs.

Alenia
Alenia Aeronautica and Xian Aircraft Company (XAC) of China, which already produces Section 16 of the ATR turboprop, said XAC will produce Section 18 of the ATR aircraft - a rear section of the fuselage - in China. The Xian Aircraft Company is part of AVIC I, the China Aviation Industry Corporation Consortium. Manufacturing starts in 2007 when sections 16, another part of the rear fuselage, and 18 will be directly joined in Xian (China) before being assembled with the rest of the fuselage by Alenia in Italy, meaning between 15 percent and 20 percent will be manufactured in China. Over a four-year period from 2005 to 2009, the additional activity generated by this agreement, coupled with the dramatic increase in the production rate of the ATR aircraft will multiply by ten-fold the Chinese aeronautics industry labor volume dedicated to ATR production.
The manufacturing of the Section 18 reinforces the ties between ATR and the Chinese aeronautical industry, which started in 1985 with the supply, also by XAC, of the ATR 42 outer wing boxes.
AVIC I is a large, state-owned industrial group. AVIC I includes 47 large- and medium-sized facilities, 31 science and technology research institutes, and 22 specialized companies and institutions. It employs 230,000 people and its assets exceed $20 billion. In 2006, AVIC I delivered $360 million in subcontracted aeronautical products, with a 40 percent annual growth over three consecutive years.