Is FAA agreement with China to increase flow of aircraft a good idea?

Share this article: Facebooktwittergoogle_pluslinkedinFacebooktwittergoogle_pluslinkedin

FAA Enhances China Aviation Safety Partnership

Boeing to gain as China accepts US safety approval

FAA and CAAC sign bilateral agreement on certification
 China is tempting market but potentially massive competitor

 

In anticipation of President Trump’s imminent State Visit to the Peoples’ Republic of China, the FAA and its Chinese equivalent signed a ground-breaking agreement. That document will facilitate the flow of aircraft and aviation parts between the two countries. No doubt that there will be short term gains for the US, but in the long term, is it a good idea.

Since 2005, negotiations between the Federal Aviation Administration, on behalf of the world’s largest, most developed and sophisticated  aviation economy and the Civil Aviation Administration of China, representing the world’s largest consumer market and  an emerging aerospace industry, have created a relationship which allows the two authorities to respect their respective certification competences. Recently, they announced that under their Bilateral Airworthiness Safety Agreement (BASA 2005) have executed an Implementation  Procedures Agreement (IPA). The most recent document reflects years of technical talks and exchange of standards/interpretations.

According to one commentator,  China has…adopted much of the US system of aviation regulation.” That’s grand news, if in fact CAAC has copied the FAA’s criteria and processes. The FAA press release noted “[t]his agreement supports the FAA Aircraft Certification Service’s refresh of certification strategy by responding to stakeholder needs and promoting the seamless transfer of products and approvals globally. Congruency between the two countries’ regulatory approach, as noted by The Business Standard, “may boost the Asian nation’s burgeoning aviation industry and make it easier for companies like Boeing to sell products there.”

The FAA’s reaching the agreement may benefit US aerospace companies in the near term. “Chinese airlines will spend more than $1 trillion on new aircraft over the next two decades as they seek to meet booming demand for air travel, according to a new forecast by Boeing,” as reported by CNN News. That constitutes a major target for the Chicago-based aircraft manufacturer.

Boeing manufactured for China

CNN adds the following relevant numbers to the market analysis, suggesting that in the near term, China’s national replicas of Boeing may be winning some domestic orders:

 

  • 487 million:That’s the number of domestic and international journeys made last year in China, according to data from the Civil Aviation Administration of China (CAAC).
  • Even more impressive is how quickly the market is growing. The number of trips made last year increased by 12% over 2015, according to CAAC.
  • The surge in air travel has been fueled in large part by middle class Chinese who are spending billions on domestic and foreign vacations.
  • With a population of 1.4 billion, the trips add up: Analysts predict that China will surpass the U.S. as the world’s largest commercial aviation market by 2030.
  • 5,100Boeing estimates that the country will need a trillion dollars worth of new airplanes over the next two decades, including more than 5,100 of the same size as the C919.
  • Most of that money would have been destined for bank accounts at Boeing and Airbus if not for the C919. Now, there’s a new competitor on the block.
  • With 168 seats, the C919 is expected to go up against the Airbus’s A320 and Boeing’s 737-800.
  • 55:That’s the number of Chinese airlines currently in operation.
  • Domestic airlines expected to be major buyers of the C919. So far, demand for the jet has remained local: orders are almost entirely from Chinese carriers for domestic flying.
  • The jet is one of the final pieces of an aviation ecosystem that has been in development for decades in China.
  • The company that developed the C919, Commercial Aircraft Corporation of China (Comac), is owned by the state. Most domestic airlines are also backed by the government.

 

It might be surprising to see the C919 or the ARJ21 to be sold in the United States, but certainly the African, South American and Eastern Europe markets might be attracted to aircraft, likely at low prices due to subsidies from the Peoples’ Republic of China. The sales there will be facilitated by the likelihood that these aircraft may bear the imprimatur of the FAA.

 

 

 

 

 

Overall, the Chinese aerospace industry is quite robust and has sufficient capacity to support major sales efforts. See below summary and this website.

Further, the country is filled with factories established there by European and American aviation concerns.

 

That’s a formidable array of potential competition for Boeing, Airbus, Embraer, Canadair and the rest of the existing manufacturers.

EASA has made similar comity efforts with the Chinese sovereign. The two have over 100 Working Arrangements, but most facilitate the use of European certifications within China.  EASA and the Civil Aviation Administration of China (CAAC) held their first Aviation Safety Conference in April of this year. From the public statements, the agenda

  • to broaden the bilateral dialogue,
  • to discuss the benefits of international agreements,
  • to examine the role that industry and regulators can play in this process,
  • to review new technologies and concepts like risk-based performance will shape future developments in fields such as airworthiness, maintenance, flight operations and training,

and

  • to bring together their respective staffs and the wider European industry).

seems to be more rudimentary than the FAA-CAAC’s BASA & IPA status.

CAAC EASA conf

But underestimating the degree to which Europe will compete is not prudent!

The Administrator has established an International Aviation Strategy and true to the Agency’s mission, the goals focus on where the FAA might have the greatest impact on aviation safety. In that Congress, in its infinite wisdom and misunderstanding of the term, decided to delete “promote” from the FAA’s statutory charter; it makes it difficult for the safety agency to make decisions influenced by ANY commercial considerations. From a broader perspective, which should be part of the mandates of the Transportation, Commerce and State, was it wise to give freer access to the PRC, which is not known for its fair trade habits nor the protection of intellectual property, to the airline markets of the US and the rest of the world for the immediate and long term.

 

 

 

.

 

 

 

 

 

 

Share this article: Facebooktwittergoogle_pluslinkedinFacebooktwittergoogle_pluslinkedin

Be the first to comment on "Is FAA agreement with China to increase flow of aircraft a good idea?"

Leave a comment

Your email address will not be published.