Beijing's port city of Tianjin has moved to the fore of China's aerospace sector thanks to investment from Airbus Tianjin and China's leading aerospace conglomerate Aviation Industry Corporation of China (AVIC).
Airbus Tianjin is the first Airbus A320 assembly plant outside Europe and delivered its first aircraft on 23 June. When Flight International visited the factory on 23 July the second aircraft was being delivered, this time to Hainan Airlines.
There was relatively little fanfare for the second aircraft, unlike the factory's official opening ceremony on 28 September 2008 at which the guest of honour was the country's prime minister, Wen Jiabao.
A large poster of Wen is displayed inside the main assembly plant which, on the day of our visit, had 10 A320-family aircraft inside in various stages of completion.
© Leithen Francis/Flight International
Airbus Tianjin is due to deliver 11 aircraft this year
Employees at Airbus Tianjin are proud that the country's top leadership came to the factory's opening and it could be argued the move to establish Airbus in Tianjin has a lot to do with the premier.
Wen was born in Tianjin and while holding power he has been pushing for the development of Tianjin as China's third major economic zone after the Pearl River and Yangtze River deltas.
Airbus was originally looking to Zhuhai
, in the Pearl River Delta, as the site for the factory. It had ruled out Shanghai Pudong
on the grounds that the airport there would be too busy to grant the necessary runway access for pre-delivery test flights.
Xian, which is already a major centre for Chinese aircraft manufacturing, was also in early contention, but was ruled out because it is too far inland. Airbus officials felt it would be prohibitively expensive to have the parts flown in from Europe.
This meant Zhuhai and Tianjin were on the final short-list.
Improving the best
The new Tianjin site is better than Airbus's Hamburg plant, according to its general manager.
Jean-Luc Charles says the Tianjin A320 assembly plant in north-east China is not only as good as Airbus's plants in Toulouse and Hamburg - it is an improvement.
"It is betterwe had a chance to start from a greenfield, the production flow is perfect," says Charles, adding that the main assembly plant, logistics centres, paintshop and other buildings are in the optimal position.
Airbus Tianjin copied the Hamburg assembly plant, its best in Europe, and "we took the opportunity to make Tianjin better", Charles says.
"I also have a company at a human size," he says, adding that "it is perfect to manage 500 people".
He adds: "You can be closer to people, do individual follow-up, continue with everyone more or less, ensure people are motivated and manage the efficiency. We have defined the best processes for this site."
This includes creating "clusters", where teams are responsible for one aspect of the business, a method that, Charles says, ensures that people remain focused.
In terms of recruitment, top management is involved in hiring everyone, says Charles. Everyone who works at Airbus Tianjin is also sent to Airbus in Europe for training, he adds, and managers who train the Chinese workers in Europe are the same managers they will work with upon their return, he says.
"That way we generate a team spirit," he adds.
Airbus Tianjin this year is due to deliver 11 aircraft. Next year the plant will deliver 26 aircraft and the production schedule is expected to steadily increase until annual output reaches 48 in 2012, says Charles.
The production volume is lower than that of the plants in Hamburg and Toulouse and its output is insufficient to meet the demand from Chinese carriers. The government, for example, placed a bulk order in 2006 for 150 Airbus A320s on behalf of Chinese carriers.
This means there are no plans for Airbus Tianjin to produce aircraft for overseas carriers, but Charles does not rule that out in future.
The A320s assembled in Tianjin are the same quality as the A320s assembled in Europe, he says.
Both have under-used runways and each has a seaport. This is significant because all the major subassemblies for the A320 are shipped by vessel to China from Airbus's Hamburg plant in Germany.
Zhuhai was the favourite by virtue of its location in southern China, so it takes European vessels five days less to reach port, whereas it takes 28-30 days to reach Tianjin.
But Airbus chose Tianjin because, as Airbus executives were going through the final evaluation process, the Chinese government announced a national policy of promoting the development of Tianjin as China's third major economic centre.
Since Airbus decided on Tianjin for its A320 assembly plant, the city has attracted further investment.
Chinese maker Xian Aircraft last year secured a deal from Airbus to equip the wings in Tianjin, winning the extra contract because it already makes the A320 wingboxes in Xian and it made no sense to have them shipped from China to the UK for equipping and then back to China again.
The wingboxes will continue to be made in Xian, although Xian Aircraft is building a factory adjacent to Airbus Tianjin to handle the wing equipping.
Airbus Tianjin general manager Jean-Luc Charles says that Xian Aircraft is due to deliver its first set of equipped wings in the first half of 2010.
AVIC company Avicopter is making an even larger investment in Tianjin than Xian Aircraft and Tianjin's municipal government is buying a stake in Avicopter.
Avicopter has agreed to move its headquarters from Beijing to Tianjin and have a helicopter assembly plant, research and customer support centre there. These buildings will be near Zhuhai airport and construction of the headquarters has already begun.
This AVIC firm's main focus is on development and manufacturing of helicopters, but it is also the country's leading player in composite materials, recently signing a deal to manufacture A320 elevators and A350 rudders and elevators for Airbus.
These parts will be made using composite materials and be produced at Avicopter's factory in the north-eastern city of Harbin.
There are, at this stage, no plans to transfer this work to Tianjin because even though Avicopter plans to locate its headquarters and an assembly plant in Tianjin the company still has to provide work to its other factories that are spread across the country.
AVIC is looking for funding - and believes moving to the seaside will attract more investors
Moves by Avicopter and AVIC General Aircraft to move headquarters to Tianjin and Zhuhai respectively is part of a broader push by AVIC to find additional sources of funding and boost its competitiveness by being in China's fast-growing coastal regions.
The move to the coast represents a departure from Mao Zedong's third-front strategy, which in the 1960s saw China transfer aircraft manufacturing to the country's interior.
At that time it was thought that industries important to the defence of the country should be in places where it would be hard for invading forces to strike.
Invasion was a concern because in the 1960s China's relationship with Russia had soured and there were concerns the Chinese Nationalist government in Taiwan might be successful in persuading the USA to back an attack of the mainland.
But times have changed and AVIC has discovered that having all its major factories in remote parts of the country makes it harder for it to attract and retain talented personnel who generally prefer to live in, or at least live near, the more developed cities.
Sources at AVIC say there has been instances recently where AVIC's Xian Aircraft in western China has lost top talent to Commercial Aircraft Commercial of China (Comac). The sources say these talented engineers moved in part due to the attraction of Shanghai, the city where Comac is based.
China's central government has a public policy encouraging growth in the Pearl River and Yangtze River deltas as well as the Bohai sea region that includes Beijing's port city of Tianjin.
Avicopter has chosen Tianjin and AVIC General Aircraft has chosen Zhuhai in the Pearl River Delta.
The move has provided additional sources of funding because the respective local governments have agreed to be shareholders in the respective AVIC companies.
AVIC Engines is also establishing a new commercial engine company in Shanghai, a major city in the Yangtze River Delta.
AVIC, the Shanghai municipal government and Shanghai Electric will own 40%, 15% and 15% respectively, while an investor is being sought for the remaining 30%.
The new joint venture is competing to win a contract produce jet engines for Comac.
AVIC Engines is battling Western engine-makers, but it is possible AVIC Engines will partner with a Western engine-maker that in turn may take the 30% stake in the joint venture.