(Yicai Global) Jan. 19 -- European airplane maker Airbus is planning to invest CNY6 billion (USD944.6 million) to construct a ‘late-life-stage’ aircraft depot in southwestern China to handle the country’s rapidly ageing fleet by providing a range of services including dismantling and recycling.

Covering an area of 700,000 square meters, the center will be located in Chengdu, southwestern Yunnan province and will be able to accommodate 120 airplanes, The Paper reported yesterday. It is the first ‘lifecycle’ service project by Airbus outside of Europe.

The base will store aircraft and provide repairs, maintenance and airworthiness management while in storage, said Xu Gang, chief executive officer of Airbus China. It will upgrade planes to get them back in service, refit passenger planes into cargo ones and handle second-hand sales. When the aircraft has reached the end of its lifespan, it will offer disassembly services, which includes the removal and resale of usable components and eco-friendly recycling.

Airbus is planning to set up a joint venture with the Chengdu municipal government and the regulators of the city’s Shuangliu district where the Chengdu airport is based later this year, said Hu Yongdong, the firm's deputy strategy, development and operation director in China. The JV will be 70 percent owned by Airbus, 20 percent owned by Airbus’ European partner Tarmac Aerosave and the rest held by the Chengdu government.

China’s fleet is getting older, and each year there is likely to be a 15 percent increase in aircraft over 12 years old, the Leiden, Netherlands-based company said. This leads to challenges for carriers who must now deal with the late life period of airplanes, Xu said.

China is Airbus’ largest market, accounting for 20 percent of deliveries. Over half of the 100 seat-and-above planes in China are made by Airbus, at around 2,100 units.

Editor: Kim Taylor