By Phuong Nguyen, Francesco Guarascio and Lisa Barrington
HANOI (Reuters) – China’s drive to interrupt into overseas aviation markets with its homegrown COMAC jets has intensified, with a push to steer Vietnam to authorise its planes within the nation, in accordance with two individuals with data of the talks and paperwork.
COMAC’s actions in Vietnam display how the state-owned agency has prior to now 12 months launched into a extra deliberate advertising and marketing strategy to regulators and airways because it seeks to compete internationally with main Western planemakers Airbus and Boeing.
After months of talks, Vietnam’s high personal airline VietJet was supposed to start out on Jan. 15 the short-term lease for a home route of two C909 regional jets operated by crew from China’s Chengdu Airways, in accordance with paperwork seen by Reuters that present perception into its technique.
However Vietnam’s aviation regulator has but to authorise the deal, cautious about greenlighting a aircraft at the moment licensed solely by China and Indonesia, the 2 individuals and a 3rd particular person stated.
The lease had been reported by Vietnamese media, nevertheless the approval delay, VietJet’s longer-term technique for COMAC jets and the planemaker’s efforts to win regulatory approval, together with providing beneficial monetary phrases and coaching, haven’t been beforehand reported.
The as much as 90-seat C909, till November referred to as the ARJ21, was China’s first jet engine-powered aircraft to achieve business manufacturing and entered service in 2016, with round 160 delivered to date.
The regional jet shouldn’t be as high-profile as COMAC’s extra superior narrowbody C919 aircraft, however it might enable the planemaker to achieve a foothold in one of many world’s fastest-growing aviation markets and increase its visibility exterior China forward of a C919 manufacturing ramp-up.
It will additionally ship a message to rivals.
VietJet had been speaking to a overseas lessor for months to lease two E190 regional jets constructed by Brazil’s Embraer, the highest international maker of 90-seat jets, separate sources accustomed to the discussions stated, with one including pilots had been within the means of being employed for these planes.
However the talks collapsed late final 12 months, Vietnamese media reported. VietJet meant to make use of both the Embraer or COMAC planes to attach Vietnam’s essential cities to the vacationer archipelago of Con Dao, the place bigger jets can’t land.
The 2 individuals with data of VietJet’s talks with COMAC stated the Chinese language provide was underneath very engaging monetary phrases that one of many individuals stated have been “too good to withstand.”
The individuals declined to be named as a result of the talks weren’t public.
VietJet, considered one of Asia’s largest low-cost carriers with a fleet of round 100 Airbus jets and round 200 Boeing 737 MAX jets on order, declined to remark.
COMAC, Vietnam’s civil aviation authority and Chengdu Airways didn’t reply to requests for remark.
CHARM OFFENSIVE
China and Vietnam have deep financial ties and in current months have launched into cooperation in sectors resembling defence and transport infrastructure that had beforehand been seen as non-starters resulting from a historical past of battle between the communist-run neighbours that also sometimes conflict over South China Sea boundaries.
Because it grew to become clear VietJet wouldn’t obtain a regulatory nod in time to start out the C909 lease final week and profit from the busy Lunar New 12 months journey interval starting subsequent week, Chinese language authorities launched an obvious attraction offensive.
COMAC Board Director Tan Wangeng visited Hanoi final Wednesday and China’s President Xi Jinping had a name with Vietnam’s chief To Lam the identical day, during which he urged the nations to “step up connectivity,” Chinese language state media reported.
Regulatory and VietJet workers have been scheduled to be at COMAC’s Shanghai amenities from Jan. 14 for a 10-day coaching on C909 requirements, operations and upkeep, VietJet paperwork present.
It’s unclear when Vietnam might authorise the deal, however shortly after the Xi-Lam name, Vietnam’s authorities stated publicly it was working to take away regulatory hurdles to permit COMAC plane to function within the nation.
Rob Morris, international head of consultancy at Cirium, stated the leasing deal might not want a full certification evaluation of the C909 jets by Vietnam’s regulator.
“Therefore, I believe this settlement can probably be made shortly,” he stated.
GLOBAL PLANS
VietJet’s short-term lease of two COMAC jets is a small deal that trade sources stated doesn’t make conventional business sense for a big low-cost airline.
However after that, VietJet would ultimately look to introduce extra planes, together with probably for routes to China, a VietJet doc dated Dec. 17 stated.
VietJet’s talks with COMAC included the final word goal of utilizing C919s sooner or later, in accordance with a separate supply accustomed to the matter.
The C909 and C919 are at the moment flown solely by Chinese language airways apart from one Indonesian service working the C909.
Each planes have stable security information with no recognized accidents, however they’ve far fewer flying hours in comparison with rival fashions and haven’t been licensed by Western regulators.
COMAC displayed its planes final February for the primary time exterior China in Singapore, together with a cease in Vietnam, marking a modified strategy from beforehand restricted public engagement exterior China.
In January, Brunei-based startup GallopAir chartered a China Southern Airways C909 to Brunei as a stop-gap measure whereas the nation’s regulator considers certifying the aircraft, CEO Cham Chi stated.
GallopAir in 2023 ordered 15 C909s and 15 C919s, within the first non-Chinese language C919 order.
COMAC has been reaching out to airways, regulators and aerospace companies round Asia and past, and stated this month it needs the C919 flying to Southeast Asia by subsequent 12 months.
Round 16 C919s fly with Chinese language airways, whereas COMAC goals to supply 30 this 12 months.
COMAC is pursuing EU certification for the C919, however the lack of certification for its planes by regulators exterior mainland China stays a vital hurdle for COMAC to achieve acceptance by overseas airways.
Vietnam’s regulator needs to verify any authorisations wouldn’t jeopardise compliance with overseas aviation regulators, together with the U.S., the primary two individuals stated.
(Reporting by Phuong Nguyen and Francesco Guarascio in Hanoi and Lisa Barrington in Seoul; Further reporting by Tim Hepher in Dublin, Dan Catchpole in Seattle, Khanh Vu in Hanoi and Eduardo Baptista and Sophie Yu in Beijing; Modifying by Jamie Freed)
