Boeing's Chinese Plant to Deliver First 737 Max

The Boeing's 737 Completion and Delivery Center in Zhoushan, East China's Zhejiang Province, which is jointly built with its Chinese partner, the Commercial Aircraft Corporation of China, will be put into operation in December and deliver its first plane, the 737 Max, according to a statement the company sent to the Global Times on Tuesday.

The center will undertake relevant work involving the installation, coating and maintenance of the 737 Max and it is expected that the full capacity of the center will reach 100 planes a year, the statement said.

"It is the first time that Boeing expanded part of its 737 production system overseas to be closer to Chinese clients, which also marks a major breakthrough in the China-US cooperation in high-tech industries," the statement stressed. The US aircraft-maker also has put the modification work of the Boeing 737-800 Boeing Converted Freighter (BCF) in China to meet  robust local demand. The work was carried out by Boeing Shanghai Aviation Services and Taikoo (Shandong) Aircraft Engineering Company, and the two companies have delivered the first four Boeing 737-800 BCFs earlier this year.

"Over the last 40 years, Boeing and Chinese partners have built deep relations in all industrial chains, including the research of new technologies, parts manufacturing as well as flight maintenance and modification," the statement said.

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For example, over 10,000 Boeing aircrafts flying around the world have used parts and components made in China and Chinese firms have participated in the manufacturing of all Boeing's aircraft types, including the 737, 747, 767, 777 and the most innovative 787 Boeing 787 Dreamliner.

Industry insiders said that the completion of the Zhoushan plant, announced amid ongoing China-US trade frictions, reflects US companies' heavy dependence on both the supply chain in China as well as the country's huge market. Take the cargo carrier as an example. It is estimated that the global market will need 1,200 cargo carriers modified from standard aircrafts in the next 20 years, and the demand from Chinese carriers would account for about 33 percent of the global demand, according to a report issued by Boeing in September..

"Can the US really get rid of products made in China and abandon a burgeoning Chinese market? Boeing's decision provides the best answer," Bai Ming, deputy director of the International Market Research Institute under the Ministry of Commerce, told the Global Times.

Another reason behind Boeing's plant in Zhoushan is the 25 percent tariffs China imposed on certain US-made jets, including the Boeing 737 aircraft. The tariffs became effective in April. "The tariffs are pushing Boeing to start local production," Bai said.

This article was originally published in Global Times.