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Boeing flies into China with plan to set up first overseas plant

14 March 2017

US aircraft maker Boeing is powering ahead with China expansion plans, betting big despite the country's economic slowdown. Boeing is set to break ground on its first overseas plane factory by the end of this month, with plans to deliver 100 planes per year, with the initial batch expected in 2018, Chinese state media reported.

Boeing will team up with Chinese aviation manufacturer Commercial Aircraft Corporation of China Ltd (COMAC) to build a Boeing 737 completion centre in Zhoushan by the end of March, state-run Xinhua news agency reported.

This is Boeing's first overseas facility as part of its 737-production system, and designed to deliver 100 Boeing 737 planes a year.

The move is in part fueled by Boeing's own forecast that China will need 6,810 new aircraft, estimated to cost $1 trillion, in the next 20 years.

A report on Boeing's annual current market outlook released last September said China is expected to become the world's first trillion-dollar aviation market within 20 years.

Airbus, the French plane manufacturer has already established its assembly line factory in 1994 in Tianjin city located close to Beijing.

China's transportation industry is booming and commercial airlines have rushed to add routes as more airports open across the country.

Boeing's new factory will focus on finishing the interior and exterior of the company's popular commercial 737 aircraft, along with delivery to Chinese customers, according to Boeing. The plant, a joint venture with state-owned Commercial Aircraft Corporation of China, was announced in 2015 and will be located in Zhoushan, a city in northeastern China. The factory is estimated to create 2,000 jobs, reported Chinese state media.

Boeing's plans will help it to catch up to rival plan manufacturer Airbus - in 2008, the European firm opened its first assembly line outside Europe, and has since delivered hundreds of its A320 passenger jet out of that facility in Tianjin.

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