Lumberton
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Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 3:50 am

Appears that this decision is still pending. From reading the Chinese news media reports this summer, I got the impression that it was a done deal--or at least the Chinese thought so.
http://in.today.reuters.com/news/new..._India-269106-1.xml&archived=False

Quote:
FRANKFURT (Reuters) - Airbus is not yet ready to decide whether to go ahead with plans to assemble its narrow-body A320 airliners at a plant in China, the Financial Times Deutschland (FTD) newspaper said.
The aircraft maker, 80 percent owned by Franco-German group EADS, had been due to make up its mind by the end of September, the FTD said on Sunday in a preview of an article due for publication on Monday.
"A lot of progress has been achieved already but the matter is not yet ripe for a decision," FTD quoted an Airbus spokesman as saying. The spokesman declined to set a new timetable, FTD said.
An EADS spokesman declined to comment.
The Chinese government gave its formal go-ahead in June for an A320 assembly plant in the northern port city of Tianjin.
"When all is said and done, more will be said than done".
 
Ruscoe
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RE: Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 5:52 am

I don'tthink it ever will.
It would be economic madness to open a new line in China, and keep the European 320 operation going.
Airbus seem more than competitive with Boeing with 320's built in Europe,so why export European jobs?

I don't know what Airbus have told the Chinese, or whether it was done to secure an aircraft deal. That is where itcould become interesting.

Building the 380 in China would be a much better idea, but then what about the Russians?

Is this an example of State influence in the aircraft manufacturer.

Ruscoe
 
Lumberton
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RE: Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 6:54 am

Quoting Ruscoe (Reply 1):
t would be economic madness to open a new line in China,

You may be right, Ruscoe, but won't the Chinese be a mite disappointed if they don't? I think there may be more than mere expectations on the Chinese side. Could the promise of a production line have been part of the 150 A320 deal last year?
"When all is said and done, more will be said than done".
 
Ruscoe
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RE: Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 7:25 am

Quoting Lumberton (Reply 2):
Could the promise of a production line have been part of the 150 A320 deal last year?

I hope not!

Ruscoe
 
DfwRevolution
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RE: Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 7:48 am

Quoting Lumberton (Reply 2):
Could the promise of a production line have been part of the 150 A320 deal last year?

I would also doubt it. China ordered an equal 150 737NG from Boeing with zero hints that Boeing would open a 737 line in China.

Remember, the Third Law of Aircraft Ordering states - All orders from China occur in equal and opposite pairs to Airbus and Boeing.
 
NAV20
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RE: Reuters: Airbus Has Not Decided On China Plant

Mon Sep 25, 2006 11:20 pm

Quoting Lumberton (Reply 2):
Could the promise of a production line have been part of the 150 A320 deal last year?

Applying a certain amount of 'real-politik', we can all be absolutely certain that there was an umbilical connection.

We can be equally certain that Airbus, faced with the prospect of having to fire unknown numbers of European workers (even possibly including some French ones  Smile) would be raving mad to start pouring money into China, and transferring production there.

Putting those two facts together, it appears as near to certainty as you ever get in this world that the Tientsin plant won't get built, and that China is therefore likely to reneg on both the 150 X A320 orders and the 4 X A380 orders.

In strict legal terms, the three issues are probably not directly/contractually linked. So it is open to Airbus to sue for 'specific performance.'

But that would be in the mainland Chinese courts. As one who once considered that - and abandoned the idea on good advice, and took my losses - all I can say to anyone contemplating any such action is, "Good luck to all who sail in her........"  Smile
"Once you have flown, you will walk the earth with your eyes turned skywards.." - Leonardo da Vinci
 
trex8
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 12:31 am

every few years we have some Western OEM saying they will move an assembly line to somewhere in the Far East. BAe talked about their RJs going to Taiwan, so did MDC and their MD12 also. This is just the latest in a line of similar potential projects, though this one probably is more likely the other two I mentioned.
 
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Stitch
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 12:36 am

My only worry is that if Airbus opens an A320 line in China, that will close China as a source of A320E and A320RS orders as China will source their narrowbodies from their own plant.

And since Airbus will get royalties (at minimum) from the Chinese plant, that means China, to maintain "parity", will need to order widebodies from Boeing (since 737NG and 737RS sales will also be unlikely), which will impact Airbus' ability to sell the A330/A350.

I know many believe Boeing is selling their future by allowing Japan to make so much of the 777 and 787, however it strikes me as if Airbus is doing the same - and far more quickly - at least in China if they allow this deal to go through.
 
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Revelation
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 1:00 am

One of Airbus's big problems is their income is in dollars (which is currently weak), and most of their costs are in euros (which is currently strong). Moving production to China would shift expenses from euro-based to dollar-based, since the yuan is tied to the dollar. Rumours about the 100 day (now 128 day) plan that Streif is to announce say that there will a focus on the whole euro/dollar issue.
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airfrnt
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 1:22 am

Airbus will open the A320 line in China the second that they get enough orders from state controlled China airlines to make it worth their while. It's a political move, pure and simple.
 
trex8
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 1:27 am

Quoting Stitch (Reply 7):
My only worry is that if Airbus opens an A320 line in China, that will close China as a source of A320E and A320RS orders as China will source their narrowbodies from their own plant.

why wouldn't the Chinese make the newer models as well if there is a large enough local market?
 
Shenzhen
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 2:24 am

If history tells us anything, opening a new A320 plant will not offer Airbus any increase in the Chinese market.

McDonnel Douglas, Embraer and Bombadier have all tried this in the past, yet they never gained anything in return, after the first batch were sold.

In fact, China bought more 737s and A320s over the MDs when they were being assembled there.

Cheers
 
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Stitch
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RE: Reuters: Airbus Has Not Decided On China Plant

Tue Sep 26, 2006 3:40 am

Quoting Trex8 (Reply 10):
Why wouldn't the Chinese make the newer models as well if there is a large enough local market?

It depends on what facilities the A320E and, especially, A320RS require. If the A320RS is CFRP as expected, you won't be able to build it on a traditional A320 line. So it might not be possible for the Chinese plant to build anything other then the A320.

Also, Airbus may want to keep A320E production in TLS and HAM as such planes would have higher market values and could be sold for a premium over the A320, which would help cover the higher EU production costs.

Such a dual strategy could allow Airbus to bracket the 737NG, using the capabilites of the A320E on the top and lower prices on the A320PRC on the bottom.