China Aviation Industry Corporation I (AVIC I), an ultra large State-owned group company, is committed to the rapid growth of China's aviation industry.

Established on July 1, 1999, the group company has manufactured aero products in a wide range, including fighters, fighter-bombers, bombers, transport aircraft, reconnaissance aircraft, turbojet engines, turbo fan engines, air-to-air missiles and ground-to-air missiles.

Figures from the company show that AVIC I has contributed 90 per cent of aviation weaponry systems to China's national defence industry.

AVIC I is now stepping up efforts to revamp up its aero product line-up and increasing investment in research and development (R&D) especially in civil aircraft.

Based on its own technological strength, the group company has made substantial progress in this direction.

New series of aeronautical equipment, civil aircraft and special-purposed aircraft, such as tanker planes, early-warning planes and unmanned aerial vehicles (UAVs), are under development and production.

And ARJ21 and MA60, two types of passenger planes developed by the company, are typical examples to illustrate the popularity of AVIC I's civil aero products with the market.

MA60, or known as "New Ship 60," a kind of turbo propeller regional aircraft, has been exported to many overseas operators.

ARJ21, a kind of turbo-fan regional jet with AVIC I's own intelligent property right (IPR), is scheduled to start its maiden flight in 2008, yet has already won the company 41 orders worth of nearly 4 billion yuan (US$500 million) from Chinese airline service providers and a financial leasing firm.

According to AVIC I, the ordered jet airliners will be assembled next year and begin commercial operation in 2009.

Business expansion

In addition to focusing on plane manufacturing as its core business, the plane maker also pays attention to the development of aero equipment and systems.

As the heart of an aircraft, aircraft engines are one of the key businesses for AVIC I. The group company has invested heavily in research and mass production of aircraft engines and derivatives.

Through international co-operation and technological innovation, AVIC I is sharpening its competitive edge in the fast-growing aero engine industry.

In the field of turbines, AVIC I also takes the lead. For instance, AVIC I is the birthplace of R0110, the first heavy-duty gas turbine fully developed by Chinese engineers. The turbine was listed as one of the key projects in the nation's "863 Programme" during the 10th Five-Year Plan period (2001-05). With an output rating of 114.5 megawatts and an efficiency of 36 per cent, R0110 can be used for ground-based clean power generation.

At the same time, AVIC I has expanded its business scope to non-aero fields. Its non-aero businesses mainly cover the sectors of transportation vehicles and components, refrigeration equipment, and machinery.

Nearly 40 enterprises under AVIC I are involved in production of motorcycles, luxury coaches, airport vehicles, light vehicles, automobile parts, environmental protection facilities, and fire fighting devices.

AVIC I's strongly-performing export of motorcycles and auto components is convincing evidence of the company's competitiveness in the industry.

As for refrigeration equipment, Qing'an air conditioner compressors are a good illustration of AVIC I's performance in the sector.

With an annual production capacity of over 6 million sets, the Qing'an air conditioner compressors are supplied to top Chinese electronic makers, such as Haier, Gree and Midea, and meanwhile exported to Europe, North America and the Middle East.

AVIC I also provides a great variety of machinery for textiles, metallurgy, chemicals, power generation, medical equipment, food industry and packaging industry.

And many of AVIC I's machinery products, including draw frames, flexible sward rod looms, high-speed line material precision rolling machines, tyre machines, tea-bag packaging machines, are exported to the Middle East, Southeast Asia, the United States and Russia.

Technological strength

As a high-risk industry, aviation is not only capital-intensive but also technologically demanding.

That is why AVIC I always gives a priority to strengthen its R&D capabilities.

At present, AVIC I has 28 research institutes, seven laboratories for defence technologies, 27 key laboratories for aviation science and technology, six enterprise-based technology centres and eight provincial-level technology centres.

Nearly 8,900 engineers work with the group company, accounting for 40 per cent of the company's total staff.

Such a strong R&D team is a driving force behind the company's sustainable growth.

In addition to rich engineering professionals, well-established technological facilities are another contributing factor in AVIC I's development.

For instance, the National Flight Test Centre, one of AVIC I's facilities, is an authorized institute for airworthiness certification and project validation.

China Aeronautical Establishment (CAE) of AVIC I is also engaged in the testing of aeronautical products in addition to basic and application research.

In recent years, the testing facilities and infrastructure have been continuously upgraded and testing capabilities have increased, which provide a guarantee for aero product quality.

Technological strength is not limited to the R&D phase alone, but leveraged across the entire production circle.

AVIC I set up its Management and Control Centre, a management IT platform for engineering, manufacturing and customer support activities in 2005.

The information platform improves efficiency of collaboration on significant issues and balances product delivery, and will be a foundation for product life cycle management, and real-time full-range supervision on development, production, supply chains and customer relations.

AVIC I's leading-edge technologies and overhauled management system have attracted attention from abroad.

Efficient performance

AVIC I has been making great efforts in building a comprehensive marketing system, covering market research, branding, information and sales network, seeking to expand exports and strengthen competitiveness.

AVIC I has been accelerating its globalization, through implementing international practices in technology, marketing, project management and after-sale service and increasing capabilities in co-operation as a risk and revenue-sharing partners, especially in the commercial aircraft business. AVIC I is working hard to become an excellent supplier and preferred partner.

AVIC I has been active in expanding market shares, increasing its international presence and improving brand recognition by participating in international airplane shows and promoting its business potential globally.

AVIC I has established industrial, technological and trade relationships with more than 40 companies and institutions in more than 30 countries.

AVIC I is pushing forward reform, aimed at equity restructuring. At present, nine subsidiaries of the group company have gone public and another seven subsidiaries are preparing for initial public offerings.

With rationalized product structures and improved operational performances, the group company has maintained a robust and healthy growth in recent years.

Its sales income grows by 22 per cent annually. Total sales income reached 68.5 billion yuan (US$8.6 billion) in 2005, and sales of aeronautical products contributed 56 per cent.

Total assets soared to 142 billion yuan (US$17.75 billion) in 2005 from 63.6 billion yuan (US$7.95 billion) in 1999.

(China Daily 10/31/2006 page13)