China's two principal state-owned aircraft makers, AVIC I and AVIC II, are planning to restructure in order to pave the way for the realization of the country's ambition to manufacture and market a "jumbo" commercial aircraft.

According to AVIC I Vice MD Gu Huizhong, China's Commission of Science, Technology and Industry for National Defense and other relevant government organs already are examining the restructuring plan. With development of a "jumbo aircraft" atop the agenda (ATWOnline, Dec. 24, 2007), it is widely speculated that Beijing will separate the civil aviation business from military within the AVIC Group and integrate the civil business of AVIC I and AVIC II into one company or several branch companies.

Last February, the China State Council decided to set up a new company to develop a large commercial aircraft, which industry insiders suggest will be launched in March at the earliest (ATWOnline, May 1, 2007). Analysts have said that this new entity likely will be focused on aircraft design and final assembly, while the restructured AVIC will be responsible for the production of parts and equipment. AVIC II said the companies will operate independently.

Meantime, AVIC I and AVIC II each have welcomed foreign cooperation and contributions in the development of a large aircraft.

Source: ATW 8 Jan 2008