Airbus A220 being manufactured in China.
Airbus A220 being manufactured in China.

Why Airbus is building a supply chain in China

4 August 2021

 

Aviation manufacturer Airbus is shifting more of its supply chain to China in a bid to further diversify its global reach
The European company is establishing an integrated vertical supply chain within China to allow it to assemble and deliver aircraft in-country using more local workers, which it said will bring its Chinese suppliers “in line with global standards of Airbus”.
Airbus head of flyable procurement in China and East Asia, Yang Xiaoyu, told China Daily: “We are forming a vertical integration supply chain in China, meaning we purchase raw materials and parts, do the parts assembly and deliver the aircraft in China to lower costs of transportation and raise efficiency." 
Airbus has been expanding its presence in the region in recent years, a move welcomed by China, the world’s fastest growing aviation market. 
In 2020, its annual industrial spending in China reached around $1bn, increasing by almost 60% from 2016. 
"Airbus' increasing investment in China shows its recognition of China's manufacturing skills and the capacity of the civil aviation industry chain in China," said Zou Jianjun, a professor at the Civil Aviation Management Institute of China.
Despite disruptions to the aviation industry throughout the pandemic, the manufacturer delivered 99 planes to China in 2020 and 64 in the first half of 2021. 
It plans to increase production of the A220 aircraft, the only model which has seen a stable rate of production throughout the pandemic and in which 15 Chinese firms supply one-third of the airframe. 
"The global aviation industry is still casting a cloud on the future due to the pandemic, and international travel is stagnant,” said Li Min, senior marketing director of Airbus China “[But] the A220 is expected to become a bright spot in the downturn of the global aviation market.”

Aviation manufacturer Airbus is shifting more of its supply chain to China in a bid to further diversify its global reach

The European company is establishing an integrated vertical supply chain within China to allow it to assemble and deliver aircraft in-country using more local workers, which it said will bring its Chinese suppliers “in line with global standards of Airbus”.

Airbus head of flyable procurement in China and East Asia, Yang Xiaoyu, told China Daily: “We are forming a vertical integration supply chain in China, meaning we purchase raw materials and parts, do the parts assembly and deliver the aircraft in China to lower costs of transportation and raise efficiency." 

Airbus has been expanding its presence in the region in recent years, a move welcomed by China, the world’s fastest growing aviation market. 

In 2020, its annual industrial spending in China reached around $1bn, increasing by almost 60% from 2016. 

"Airbus' increasing investment in China shows its recognition of China's manufacturing skills and the capacity of the civil aviation industry chain in China," said Zou Jianjun, a professor at the Civil Aviation Management Institute of China.

Despite disruptions to the aviation industry throughout the pandemic, the manufacturer delivered 99 planes to China in 2020 and 64 in the first half of 2021. 

It plans to increase production of the A220 aircraft, the only model which has seen a stable rate of production throughout the pandemic and in which 15 Chinese firms supply one-third of the airframe. 

"The global aviation industry is still casting a cloud on the future due to the pandemic, and international travel is stagnant,” said Li Min, senior marketing director of Airbus China.

“[But] the A220 is expected to become a bright spot in the downturn of the global aviation market.”

LATEST
JOBS
Location: Home-Based with travel
We are offering a salary up to £60,000 for this role, depending on experience.
Zurich Insurance Ltd
Canary Wharf, London (Greater)
£33,119 - £37,209 pa
CMA
SEARCH JOBS
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates
GO TO CIPS KNOWLEDGE