XIAMEN - Aircraft
giant Boeing is likely to set up an aircraft
maintenance, repair and overhaul (MRO) base in Shanghai in the first
half of next year, the first such
foreign-controlled facility in China.
The
US aircraft giant will initially invest over
US$100 million into the company, in which Boeing
will hold a 50% stake, said David Wang, Boeing
China's president. Shanghai Airlines and the
Shanghai Airport Authority
will hold the remaining shares. The joint venture
is now waiting for final government approval.
Wang made the remarks yesterday on the
sidelines of a delivery ceremony in Xiamen, in
East China's Fujian province, for the
first 747-400 Boeing converted freighter to Cathay
Pacific Airways. The jet was converted from a
14-year-old Cathay Pacific passenger aircraft.
Taikoo (Xiamen) Aircraft Engineering Co
Ltd (TAECO), one of China's largest MRO suppliers,
completed the modification in September. Boeing
test pilots flew the airplane from Xiamen to Hong Kong and conducted
two months of flight testing. This is the first
time Boeing has completed a major flight test
program outside the United States.
Boeing
launched the 747-400 passenger-to-freighter
program in January 2004. So far it has received 37
firm orders for conversions from six overseas
airlines. TAECO, of which Boeing holds 9.09%, will
be responsible for converting 33 such airplanes.
"TAECO is our first partner in the 747-400
conversion. Its technical performance is superb,"
said Lou Mancini, vice-president and general
manager for Boeing Commercial Aviation Services.
Converted freighters have been a
cost-effective solution for airlines that want to
increase air cargo capacity. It helps increase the
value of existing aircraft and gives an airplane a
second life. More than half of the freighters that
are currently in service around the world have
been converted from passenger jets.
TAECO
will convert, for Cathay Pacific, another two
747-400 passenger jets into freighters in 2006 and
three in 2007. Derek Cridland, Cathay Pacific's
engineering director, declined to reveal the cost
of the conversion. But he said: "The conversion is
a good solution for an airline that wants to
quickly add air cargo capacity."
It takes
about four to five months to convert a 747-400
passenger jet into a freighter, which is a much
shorter time than it would take to deliver a brand
new jet. Cathay Pacific is the world's
sixth-largest air cargo carrier in terms of
tonnage carried. The converted freighters will be
used on cargo routes between Asia and North
America and Europe.
Also on December 19,
TAECO opened its fourth maintenance hangar
commissioned specifically to convert further
freighters.
Founded in 1993, TAECO is
54.55% owned by Hong Kong Aircraft Engineering
Company Ltd, with 10% owned by Xiamen Aviation
Industry Co Ltd and 9.09% by Cathay Pacific.
Another 9.09% is owned by Japan Airlines and 8.18%
by Beijing Kailan Aviation
Technology Development and Service Co, which is a
wholly-owned subsidiary of the General
Administration of Civil Aviation of China.
The global air cargo industry is one of
the fastest growing segments of the aviation
market. The Boeing World Air Cargo Forecast
2004/2005 projects that the industry will grow at
an average annual rate of 6.2% over the next 20
years, significantly higher than projected
passenger traffic rates. Cargo traffic growth
rates for Asian routes are projected to be over
7%.
