It seems that today is a day of headlines for Boeing, as not only does the 777-9 get closer to flight but they have also delivered their 2,000th aircraft to China!
Xiamen Airlines took delivered of a 737 Max 8 over the weekend, with a special livery embroidered on the side.
With such a milestone reached, one has to wonder if China is Boeing’s biggest customer.
Boeing’s first Chinese sale
Boeing has been a world supplier of aircraft since 1916 (Originally called the Pacific Aero Products Co) and has been selling aircraft all over the world ever since. Well, not China. Thanks to frosty relations with the communist country, Boeing would not enter the market (like other American companies) until the early 1970s.
In fact, it was President Nixon’s visit to China in 1971 that inspired the sale. During the summit, Chinese politicians were invited on board Airforce One for light refreshments, which at the time was a Boeing VC-137C, and couldn’t stop asking questions about the plane.
A year later, in 1972, Boeing was invited to put together a team to facilitate the sale of some Boeing 707s to China. This was unheard of at the time and was top secret until the deal was made.
The Boeing 707s were used in China Southwest’s new American based fleet.
“Our hosts were very gracious with showing us the historical sites. This first negotiation started a friendship that has carried on for many negotiations”. – Fred Mitchell, Boeing Delegation
Since that deal in 1972, China has always held Boeing in high regard and eagerly awaited the reveal of any new aircraft from their American friends.
Boeing and the modern Chinese market
Today, Boeing has a very deep relationship with China. China, of course, has a very unique airline market, as there is really only ‘one airline’ in the country.
Essentially, CAAC (Civil Aviation Administrator of China) has controlling interest in every domestic airline in China. Their list of airlines include:
- Air China, based in Beijing, inherited the IATA and ICAO code of CAAC
- China Southwest Airlines, based in Chengdu (merged into Air China in 2002)
- China Eastern Airlines, based in Shanghai
- China Northwest Airlines, based in Xi’an (merged into China Eastern in 2002)
- China Southern Airlines, based in Guangzhou
- China Northern Airlines, based in Shenyang (merged into China Southern in 2003)
Each of these is run independently but must authorize every airline purchase with the central authority.
Through this partnership, Boeing has sold 2,000 planes. For perspective, the biggest US airline, American Airways, only operates 484 Boeing planes.
And we should mention the pacing of the orders. It took 40 years for 1,000 jets to be delivered to China from Boeing. The 2nd 2,000 took only five years.
“The rapid pace continues as one in four Boeing-made commercial jet goes to a Chinese operator, either through direct purchase or lease” – Boeing statement
What about the future of China?
As for the future, Boeing is optimistic that this very lucrative friendship with continue.
So optimistic that they made this prediction recently: Boeing is forecasting demand for 7,690 new aircraft, valued at $1.2 trillion, by 2038. So many planes that China is single handily causing a pilot shortage.
“We are deeply honoured to have achieved this delivery milestone in close partnership with our great partners in China. Our long-standing industrial relationship in this market has been mutually beneficial, fueling significant growth in Boeing’s business, the US economy, and the Chinese aviation industry,” – Ihssane Mounir, Boeing’s senior vice president of commercial sales and marketing
What do you think about the rise of China?