China has reached a major milestone in its quest to disrupt the Boeing-Airbus duopoly over commercial aircraft manufacturing. In December 2022, the Commercial Aircraft Corporation of China (COMAC) delivered its first C919 aircraft, a narrow-body jet seeking to compete with the Boeing 737 MAX and Airbus A320neo families. COMAC’s nascence (it was founded in 2008), among other issues, has observers doubting whether the C919 can shake up the civil aviation industry. Despite these concerns, it appears that COMAC is in prime position to leverage its home-field advantage to spur adoption of its new aircraft. 

In other words, COMAC, a state-owned enterprise, will compete for sales in the Chinese market and airspace, both of which are regulated by its government owners, who also own the three largest Chinese airlines. The Chinese government routinely subsidizes COMAC, with some reports indicating that COMAC has already received up to $72 billion in development subsidies.

China’s domestic air passenger market, moreover, is expected to become the world’s largest by 2041, and Boeing predicts that “China will require 8,485 new airplanes . . . [representing] more than a fifth of global airplane deliveries over the next two decades.” Of these 8,485 planes, 6,370 are expected to be single-aisle jets (i.e., 737 MAXs, A320neos, or C919s).

With demand cornered, the Chinese government has enough power to try to fulfill supply with the C919. However, skeptics highlight several potential pitfalls that could stymie China’s plans and COMAC’s aspirations:

1. The C919’s development has been plagued with delays (further impeded by US export controls under the Trump administration).
2. Ninety percent of the C919’s component suppliers are American and European companies, demonstrating China’s continued technological reliance on the West.
3. None of COMAC’s aircraft have received a Federal Aviation Administration or European Union Aviation Safety Agency airworthiness certification, preventing US and EU airlines (which have nine of the 15 largest airlines globally) from purchasing the aircraft.
4. Although the C919 is cheaper than the A320neo and 737 MAX families, the latter perform better in passenger capacity and range.
5. The C919 is new and unproven, while the A320neo and 737 MAX 8 have been in service since 2014 and 2017 respectively. Airbus and Boeing have amassed over 7,776 and 6,600 orders for their aircraft, compared to the C919’s 1,200 orders (mainly from Chinese airlines).

Granted COMAC has little experience managing the logistical challenges associated with mass-producing civilian aircraft for the world, COMAC’s path to becoming a Boeing or Airbus remains long and arduous. Even promising air travel demand forecasts and the Chinese government’s ability to intertwine different layers of the air travel industry cannot guarantee success. So, what makes COMAC’s goal feasible? Boeing.

Because a quarter of 737s flew in China, it came as a blow to Boeing when, on March 11, 2019, the Civil Aviation Administration of China became one of the first authorities to officially ground the 737 MAX 8—after two 737 MAX 8s crashed because of a design flaw.

Despite lifting the grounding order in December 2021, the Chinese government continues to referee the 737 MAX 8’s status in China. Not a single 737 MAX 8 has been delivered to China since 2019. In fact, Boeing began remarketing some 737 MAX 8s that were originally destined to China but have remained mothballed due to China’s attitude toward the aircraft. To keep pace with its growing demand, Beijing has turned toward Europe’s Airbus. To add injury to insult, due to weapons sales to Taiwan, China imposed sanctions on Boeing Defense, Space, and Security CEO Ted Colbert, highlighting a deteriorating relationship between Beijing and Boeing. Boeing CEO Dave Calhoun has admitted that “the outlook for selling planes to China in the ‘near term’ . . . [is] negative.”

What we’re left with is the fact that the Chinese government is currently restraining the Boeing 737 MAX 8’s access to the world’s fastest-growing market for narrow-body civilian aircraft—a situation that could cause further turbulence to a company that’s already navigating through bad weather. Nevertheless, several questions remain. Will China maintain its course on Boeing? Without Boeing, can China find enough aircraft to match its air travel demand, or will it end up being the victim of monopoly pricing by Airbus? COMAC may not find a better window of opportunity to lay the foundations for global expansion, but its success is by no means guaranteed.

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