OM in the News: The Global Supply Chain for China’s New C919 Jet

More than 1,000 flights took off or landed at Shanghai’s vast airport on May 5, 2017, but one marked the beginning of a new era in the aviation business. After years of delays, the nation’s first modern large jet, the 174 passenger C919, made its maiden flight. The C919 brings its manufacturer, Comac, in head-to-head competition with Boeing’s ubiquitous 737 and Airbus’s A320. China is making its boldest attempt yet to break the stranglehold that these two giants have on the market for big commercial airliners.

“Behind the celebrations of a Made-in-China jet is the reality that Comac was able to build its new plane using a string of Western suppliers,” writes Businessweek (May 8, 2107). At least 15 foreign partners such as GE, Safran, and Honeywell worked on components and systems of the C919. Tapping into the supply chains of Airbus and Boeing allowed Comac to bypass many of the technical challenges of making a modern commercial jet from scratch and built up the company’s expertise for future designs. Companies based outside China supply C919 systems for flight control, power, lighting, cockpit control and much more. The engines and landing gear are also from overseas manufacturers.

China will need over 6,800 aircraft valued at more than $1 trillion through 2035, and 3/4 of them will be single-aisle planes. The country’s largest carrier, China Southern Airlines, had ordered more than $15 billion of new aircraft from Airbus and Boeing since 2015. So the C919 should be a game-changer for China’s aerospace industry.

Classroom discussion questions:

1.What is Boeing doing to respond to the C919 threat?

2.Describe the new jet’s supply chain.