Airbus will offer 5 percent of its outsourced work to China in the A350 program to turn the world's fastest-growing aviation market into a risk-sharing industrial partner, the European company said yesterday.

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This is the first time Airbus has declared its strategy for China since it unveiled the Power8 restructuring plan last month.

A highlight of the restructuring plan is a new operational model for Airbus to outsource half of A350's aerostructure work to a network of risk-sharing development partners as the aircraft maker seeks better distribution of development costs and risks. This is about twice as much as in the company's earlier programs.

"To extend its global footprint with the A350, Airbus will offer 5 percent of outsourced work to China with more offers to come," Airbus said in a newsletter yesterday.

Airbus announced two years ago that it would offer China a chance for participation in the A350 program of up to 5 percent of the airframe's design and manufacturing when it set up an engineering center in Beijing. The center, responsible for the design, is 70 percent owned by Airbus, with China Aviation Industry Corp I (AVIC I) holding 25 percent and AVIC II holding 5 percent.

"That plan has not changed," Airbus said in the newsletter.

Laurence Barron, Airbus China president, said last month that China would be "more and more integrated into Airbus' industrial organization" instead of being just a component supplier.

"Despite the management changes in Toulouse, there is absolutely no change in our strategy in China," Barron said. "We have a stronger desire to continue our strategies."

The A350 wide-body aircraft is Airbus' answer to the runaway success of US rival Boeing's B787 in the lucrative market for long-range, mid-sized, twin-aisle planes. The A350 can seat 270 to 350 passengers while the B787 has 210 to 330 seats.

Boeing has received 464 B787 orders so far, with 60 from China. The plane is expected to enter service next year and enjoys a five-year head start on the A350, which has recieved 222 orders. China signed a letter of intent for 20 A350s last October.

AVIC I and AVIC II will provide some B787 components, including the composite rudder and the wing-to-body fairing panels. Airbus' engineering center in Beijing has recruited 105 Chinese engineers. That number will reach 200 by the end of next year.

(China Daily 03/09/2007 page13)

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