A New Contender: COMAC’s C919 and the Global Aircraft Market
In the competitive world of aviation, Airbus and Boeing have long dominated as the twin pillars of aircraft manufacturing. However, the introduction of China Eastern Airlines' C919 aircraft by COMAC at the recent Farnborough Airshow may signal the start of a shift in this dynamic. Despite a history marked by substantial government subsidies, totaling around $70 billion by 2020, COMAC's journey has been fraught with delays and challenges. The C919, designed to compete with Boeing's 737 MAX and Airbus's A320, took its maiden flight in 2017, a decade after its conception, and has since delivered six planes to customers, with over 1,000 orders in the pipeline.
The landscape of aerospace is rapidly evolving. Boeing projects that the global fleet of passenger planes will need to double over the next 20 years, necessitating 44,000 new aircraft. This demand presents a significant opportunity for new players to enter the market, though barriers remain high. Developing a new aircraft model could cost between $20 billion and $30 billion, requiring years of design, regulatory approvals, and the establishment of a reliable supply chain.
COMAC's C919, despite its challenges in range and capacity compared to its competitors, represents a formidable attempt by China to assert its presence in global aviation. The aircraft’s reliance on foreign components is notable, with only 14 out of 82 suppliers being Chinese. However, the Chinese government is actively working to develop a domestic aerospace supply chain, even exploring ventures into the jet-engine market.
Rob Morris of Cirium predicts that over the next two decades, COMAC could secure 20-30% of China's short-haul aircraft market, equating to roughly 6,000 planes. This would significantly impact the current duopoly, forcing Boeing and Airbus to remain vigilant and adaptable.
Historically, Airbus faced similar challenges in its early days, heavily relying on government support. Its first passenger jet, the A300, initially failed to meet commercial expectations but laid the foundation for future successes. COMAC could follow a similar trajectory with the C919, learning from its experiences to improve and innovate.
The future of aviation is poised for transformation. With COMAC's ambition and China's strategic investments, the C919 might just be the beginning of a more diversified and competitive aircraft market. As the industry evolves, the longstanding duopoly of Airbus and Boeing could see a new challenger rising to significant heights.