AlliedSignal is exploring at least eight new joint ventures in China as part of a $200 million company-wide investment to ensure a long-term strategic stake in Asia and aid selection of its systems for the AE-100 regional-aircraft project.

"What we're doing is establishing a footprint for the business in 50 years, not just the AE-100," says Robert Choulet, senior vice-president for business strategy.

First details of the proposed new joint ventures were revealed exclusively to Flight International at the China Aviation Industry Summit held in Canada on 24-26 February. They include a possible engine alliance with China National Aero-Technology Import and Export (CATIC), which will be based in Shanghai. The proposed venture will be 51% owned by AlliedSignal and 49% by CATIC, and will produce parts for various engines and auxiliary power units (APUs). Early candidates include the TPE331 turboprop, TF40 industrial/marine engine and, possibly, the RE220 APU.

The aim is to gradually increase the company's engineering capability, allowing for the eventual assembly of complete engines in China, as well as a full overhaul capability. "The deal does not involve equity from any of the AVIC [Aviation Industries of China] factories, which has been typical in the past, so this gives us the flexibility to keep our options open," says Choulet. The company could be in business by late this year believes AlliedSignal.

Other joint ventures in the "feasibility stage", include an avionics tie-up with AVIC's Shanghai-based Avionics Institute of China, and another agreement with the Beijing-based BAIN Institute, which is a wheels and brakes specialist. Another deal in the "exploratory phases" is being dis- cussed with undercarriage specialist company Huaxin in Xian, while yet another is being considered with power-management company Quin Ling in the same city.

AlliedSignal is also in the implementation phase of its joint venture in Xiamen with Chinese aerospace company TAECO, which will repair and overhaul APUs, environmental control systems (ECS), and actuation systems. The company is also "awaiting final approval for the feasibility study report" for its teaming arrangement with the Chinese Research Institute of Aero Accessories in the Pukuo economic-development zone in Nanjing.

AlliedSignal is confident that the plan will get the go-ahead. Workers are being recruited and building has started. The joint venture will design, develop and manufacture ECS. A joint venture with China Eastern Airlines to repair and overhaul wheels and brakes began in Shanghai in mid-1996.

Source: Flight International