News from South China Morning Post: Plane … check, cruise ship … check

 

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	17 June 2023
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Dear Global Impact Readers, As the saying goes, you wait ages for a bus, and then three come along at once. Well for China, it was not buses, but a plane and a cruise ship.  ✓ The C919 is China’s first locally-built passenger jet, and Adora Magic City its first home-grown large cruise liner, and both have taken significant steps in recent weeks.  The C919’s maiden commercial flight at the end of May and the sight of Adora Magic City undocking in Shanghai earlier this month represented breakthroughs for China’s advanced manufacturing and self-reliance drive.  > This week, Wendy Wu, our political economy editor, looks back at the two major milestones and examines what they mean for China’s efforts to find another economic growth engine, and of course, compete with the United States.  And just as a reminder, starting from July 1, 2023, this newsletter will be available only to our subscribers. Don’t forget to subscribe with our 25 per cent discount on a one-year plan to continue receiving this newsletter along with unlimited access to SCMP.com. If you already have a subscription to SCMP there is no action required, and you will continue to receive this weekly newsletter.  Andrew Mullen Deputy Editor, Political Economy Plane … check, cruise ship … check In August 2008, China's first bullet train started running between Beijing and Tianjin.  Four months later, the country kicked off the development of its home-grown passenger jet, the C919.  It took three years to build the Beijing-Tianjin high-speed railway, but 15 for the first C919 to make its first commercial flight at the end of last month.  Just over a week later, on June 6, China’s first locally built large cruise ship, the Adora Magic City, left its dock in Shanghai. Crossing off milestones one after another, Beijing has taken strides in advanced manufacturing as part of efforts to be more self-reliant in high-value-added industrial chains and to try to gain an upper hand in the tech war with the United States – a mission that, in Beijing’s view, it cannot afford to lose as it seeks a new engine to power its economic growth.  Designed to compete with the Boeing 737 and the Airbus A320 family of single-aisle aircraft, the C919 completed its maiden commercial flight on May 28 from Shanghai to Beijing, one of the country’s busiest routes.  The second C919 is also likely to be delivered to China Eastern Airlines, which has initially put the first on the route between Shanghai and Chengdu, and domestic media reported it is expected to fly it on more routes in the future.   For China, despite the national pride hailed by state media in self-sufficiency and stronger competitiveness in the industrial supply chain, the C919 and Adora Magic City are products of international cooperation.  The C919 is composed of more than 4 million parts, with key components such as the engine, avionics and control systems sourced from overseas, especially from the US. Some parts are subject to licences granted by the US Department of Commerce, and it may put production at risk if Washington tightens export controls against China.  More than 200 domestic companies and nearly 200,000 professionals are involved in the production and development of indigenous technology for the C919, while it also sources supplies from foreign partners and 16 joint ventures with overseas firms, Comac said.  With a unit price of 653 million yuan (US$91 million), C919 orders have surpassed 1,000, mostly from domestic buyers.  The huge market potential has raised expectations for a booming aircraft-production supply chain, and in particular, for increasing the proportion of domestic supplies.  Domestic research agencies said the C919 supply chain will inevitably lead to progress in new materials, aerospace technology and a talent pool at home.  The Adora Magic City is also following a similar pattern in production. The number of parts needed for the cruise liner is around five times that of the C919. Due to a lack of experience at home to meet the complicated and intricate requirements, most supplies for the ship needed to be imported. . . Luxury cruise ships, together with liquefied natural gas vessels and aircraft carriers, are considered “the three pearls of the crown” in shipbuilding, and competition with South Korea is set to intensify as Beijing catches up with Seoul in the high-value shipbuilding market. It took six years for Beijing to export bullet-train technology, and one decade to become globally competitive, but it may take longer for the C919 to substantially challenge the Boeing-Airbus duopoly.  Nevertheless, the C919 and Adora Magic City have marked China’s advanced manufacturing progress, as the nation continues to take steps towards boosting its self-reliance in critical industries.