Aircraft

Embraer’s joint venture in China, Harbin Embraer, is to keep its assembly line open until at least the middle of next year after securing a long-awaited reprieve deal for five ERJ-145s from China Eastern Airlines’ Wuhan unit.

The order had been under discussion for years, but Wuhan repeatedly deferred finalising it for unspecified reasons. The timing of Embraer’s announcement came a day after Chinese state-run media reported that Harbin Embraer’s production line was facing possible closure as a result of a failure to secure new aircraft sales.

Embraer says the five 50-seat ERJ-145s will be delivered to Wuhan between November 2006 and June 2007. It lifts Harbin Embraer’s order backlog to seven aircraft, as it has two ERJ-145s that it has yet to deliver to China Eastern’s Jiangsu branch from a previous order.

Harbin Embraer is a joint venture between Embraer and state-owned China Aviation Industries II and is based in the north-eastern Chinese city of Harbin. It was established in 2002 and delivered its first licence-produced aircraft, to China Southern Airlines, in 2004. The joint venture struggled from the start and has secured firm orders for only 16 aircraft, including six from China Southern, five from China Eastern for use by its Jiangsu branch, and now the five from China Eastern Wuhan. The two remaining for Jiangsu will be delivered this year. The facility can produce up to 24 aircraft a year.

China Eastern acquired 40% of Wuhan Airlines in 2002 and said last month that it would increase its stake to 96%. Embraer had been discussing an ERJ-145 order with Wuhan even before China Eastern bought into the carrier in 2002.

China’s previous effort to assemble a Western jet airliner design locally, undertaken in conjunction with McDonnell Douglas involving the MD-80/90, ended in 2000 after 37 aircraft had been completed.

NICHOLAS IONIDES / SINGAPORE