on February 17, 2024, a large domestic C919 aircraft painted by China eastern airlines (600115.SH) arrived at Singapore Changi international airport after a direct flight of 4200 kilometers. it will participate in the Singapore air show from February 20 to 25 with another C919 and three ARJ21. This is also the first time that a large domestic aircraft has flown out of the country.

so far, the number of C919 orders in hand has exceeded 1200, corresponding to a total price of about 900 billion yuan, and this number is expected to continue to rise in the global trillion-level market.

The reporter from Nandu noticed that from 1999 year began to manufacture aircraft wing groups for Airbus , from the successful introduction of Airbus A320 series aircraft as one of the four global final assembly lines, to the production and manufacture of many important parts for Airbus and Boeing , a large number of local aviation industry chain companies have been hatched, it has become a key force in the success and continuous development of C919.

orders exceed 1200 shelves, market capacity trillion level

The development of large commercial aircraft in my country can be traced back to at least 1970. The "Yun-10" launched at that time completed its first flight as early as 1980, and then it was disarmed for various reasons. Since then, it has experienced the failure of projects such as "MD90" and "AE100" until C919 was established in 2007 and a new chapter was opened.

The C919 large passenger aircraft is my country's first self-developed jet trunk passenger aircraft with independent intellectual property rights in accordance with internationally accepted airworthiness standards. It has 158 to 192 seats and a range of 4075 to 5555 kilometers. The aircraft successfully made its first flight in May 2017, obtained the type certificate (TC) on September 29, 2022, and delivered the first aircraft on December 9 of the same year.

The global market for civil aviation aircraft is vast. The "China Commercial Aircraft Corporation Market Forecast Annual Report (2022-2041)" shows that the world will receive 30367 single-aisle passenger aircraft from 2022 to 2041, and the single-aisle passenger aircraft market will be 3.64 trillion US dollars. It is equivalent to about 2.586 billion yuan, with an average annual 1.29 trillion. Among them, China will receive 6288 single-aisle passenger planes, corresponding to 5.32 trillion yuan, with an annual average of 265.9 billion yuan.

according to the analysis of China post securities research report, compared with competing models such as Airbus A320 and Boeing 737, C919, as a rising star, has certain late-comer advantages. for example, C919 uses the third generation aluminum-lithium alloy, composite material and titanium alloy on a large scale. the structural weight of the three types of materials accounts for 7.4, 11.5 and 9.3 respectively, which has good weight reduction effect and better energy saving and emission reduction advantages, fuel consumption is 12%-15% less than similar aircraft.

Tuyuan China Post Securities Related Research Report

as can be seen from the above figure,C919 has a passenger capacity similar to that of competing models, and the selling price is about 20% to 30%, of course, its voyage is slightly shorter.

in addition, Boeing's B737MAX models have been involved in many accidents in recent years, and all airlines have been careful in purchasing. the number of C919 orders in hand has increased rapidly, currently exceeding 1200 models, with a total price of about 900 billion yuan.

On the opening day of the Singapore Air Show on February 20, Tibet Airlines and COMAC signed orders for 40 C919 prototypes and 10 ARJ21 prototypes. The purchasers of C919 are mainly domestic airlines and leasing companies. For example, in September last year, China Eastern Airlines purchased 100 additional C919 aircraft from Shangfei. Since 2015, Puyin Leasing, CITIC Financial Leasing, CNNC Leasing, Aviation Industry Leasing, Huabao Leasing, Agricultural Bank Leasing and Everbright Financial Leasing have ordered 20 to 40 C919 aircraft respectively.

In addition, foreign airlines such as Germany's Purin Airlines, Thailand's Metropolitan Airlines and Brunei's Qiji Airlines have also extended an olive branch to Comac and ordered the C919.

localization rate exceeds 50%, exceeds 30 listed companies participate in the division of labor

The development of large aircraft has multiple meanings, one of which is a strong industry-driven effect.

according to the relevant research report of Guangfa Securities, according to the calculation of the Institute of Aviation Economics of Civil Aviation University of China, if the life cycle of civil aircraft is 10 years, the contribution ratio of economic value added brought by large aircraft to China is 1:86, and the contribution ratio of employment is 1:9.6. based on the current input-output ratio of large aircraft 1:80, while maintaining the current localization rate of C919, domestic large aircraft is expected to bring a market scale of trillion yuan to industrial chain enterprises. With the increase in the localization rate, it will drive the industrial chain supply chain to a new level and inject new development momentum into China's aviation industry.

combined with C919 deputy chief designer Zhou guirong and China commercial aircraft data, C919 localization rate of about 50% to 60%. Nandu reporter incomplete statistics, at least 38 listed companies business related to the C919 industry chain.

Drawing: Nandu reporter Miao Lingyun

for example, avic xifei (000768.SZ) is the largest manufacturer of C919 airframe structure, undertaking the development of key core components such as fuselage and wing. Sichuan Jiuzhou (000801.SZ) undertook the development of C919 cabin broadcast interphone subsystem and flight command vehicle. Jianghang Equipment (688586.SH) carried out the development of C919 oxygen system and inert protection system; aerospace huanyu (688523.SH) has undertaken the development of forming process equipment and semi-automatic production lines for C919 composite horizontal tail, vertical tail, rear fuselage and other components...

It is worth mentioning that the production capacity of the C919 is still in the initial stage of accelerating the climb, and only 4 have been delivered. At the beginning of 2023, Zhang Yujin, member of the Standing Committee of the Party Committee and deputy general manager of Commercial Aircraft Corporation of China, said that the annual production capacity of C919 is expected to reach 150 within 5 years; soon, Wei Yingbiao, deputy general manager of Commercial Aircraft Corporation of China, also said, In the future, C919 will soon reach an annual production capacity of 30 to 50 aircraft.

In order to digest orders, many of the above-mentioned C919 industry chain companies have actively expanded their production capacity in recent years.

in January 2023, zhongfu eagle (688295.SH) announced that it plans to invest 5.96 billion yuan to build a high-performance carbon fiber project with an annual output of 30000 tons, with the construction period from April 2023 to August 2026. In October 2023, the board of directors of AVIC heavy machinery (600765.SH) decided to pass the proposal of subsidiary anda to invest 0.38 billion yuan in the construction project of aviation forging production capacity. it is expected to add 44 sets (sets) to further expand the main capacity; on January 30, 2024, Runbei Hangke (001316.SZ) successfully won the A- 03 plot of Menghangzhi Valley, Pingyao New Town, Yuhang District, Hangzhou City, Zhejiang Province, covering an area of 18.4 mu, which is mainly used for the construction of the fund-raising project "Advanced Aviation Composite Material Research and Development Center and Production Base Project".

The rapid release of C919 production capacity is likely to drive the performance of listed companies in the industrial chain higher. Zheshang Securities predicts that the average growth rate of net profit of listed companies related to new materials (raw materials) from 2023 to 2025 is expected to be 38%, 24% and 22%. Parts related companies are expected to be 31%/29%/26%; The average growth rate of net profit of listed companies in airframe manufacturing and airborne systems in three years is expected to be 43%/26%/23%.

Competition and cooperation, COMAC shares multiple suppliers with Airbus and Boeing

COMAC was established in Shanghai in 2008. In the same year, in the northern city of Tianjin, Airbus (Tianjin) General Assembly Company (hereinafter referred to as "Airbus Tianjin") came out.

Interestingly, As the world's two major aviation giants, Airbus is much more localized in China.

Airbus Tianjin, which was born 16 years ago, is mainly responsible for the final assembly of Airbus aircraft. It has one of the four major final assembly lines of Airbus A320 series aircraft in the world, and is also Airbus's first civil aircraft assembly line outside Europe. Since its establishment, Airbus Tianjin has delivered more than 600 A320 series aircraft. And in 2016, the same year the world's first A320neo was delivered, Airbus Tianjin began to undertake the final assembly of the new aircraft.

Not only A320, Airbus also copied the final assembly capabilities of many of its important models into China. in September 2017, the first domestically assembled Airbus A330 was rolled off the assembly line in Tianjin. In July 2021, Airbus Tianjin delivered the first A350 aircraft. In March 2023, the first Airbus A321 aircraft to complete the final assembly in China was officially delivered to the airline at the Asian final assembly line of Airbus A320 series aircraft in Tianjin. In Qingdao, Shandong Province, there is an assembly line for Airbus EC135 helicopters; including Airbus's ace model A380, there was also news of final assembly in Tianjin, but with the shutdown of the project, it came to nothing.

Airbus also brought some parts production lines and production technologies to China.

As early as 1999, Airbus reached a cooperation with AVIC Xifei in the manufacturing of aircraft wings. Since 2009, AVIC Xifei has basically mastered the manufacturing, final assembly and final testing technology of all A320 parts and components, and completed the whole process of localized production.

at the same time, airbus and avic and other enterprises jointly established Harbin hafei airbus composite manufacturing center co., ltd. (hereinafter referred to as "hafei airbus"). according to the information of "China civil aviation network", hafei airbus has undertaken 100 percent of the manufacturing share and 80 percent of the assembly share of airbus A320 rudder skin, it has also become the exclusive global supplier of Airbus A350XWB belly fairings, rudders, elevators and 19-section fuselage service doors.

in addition, aleda (300696.SZ) subcontracted Airbus A320 parts through France's saifeng group. Nanshan Aluminum (600219.SH) provides Airbus with aluminum alloy plates for aircraft fuselage, structural parts and skin. Tongda shares (002560.SZ) also provide products and services for Airbus and other models through various channels.

As can be seen from the second part, these companies are also important suppliers of C919.

Boeing also has cooperation with domestic aviation industry chain enterprises, but it is lagging behind. For example, on July 11, 2018, Zhoushan Boeing Completion Center Co., Ltd., jointly invested by COMAC and Boeing, officially entered the normal operation stage. It is mainly responsible for installing and painting the interior trim and painting of the 737MAX aircraft delivered to Chinese airline customers, and delivered the first aircraft to Air China on December 15.