HNA Agrees to Add China-Built Jets to Fleet in Boost to Comac
(Bloomberg) -- Chinese conglomerate HNA Group Co. agreed to add locally built aircraft to its fleet as part of an effort to bolster a state-owned planemaker that is developing jets to eventually compete against giants Airbus SE and Boeing Co.
Signing a cooperation agreement Saturday with the Commercial Aircraft Corp. of China Ltd., HNA said in a joint statement that it plans to bring in 200 of Comac’s C919 aircraft and 100 ARJ21 regional jets over a period of time. The pact was signed in the presence of HNA and Comac chairmen Wang Jian and He Dongfeng.
A Comac spokesman said separately that HNA hasn’t placed any orders as part of the agreement.
Shanghai-based Comac is stepping up efforts to pitch its two aircraft to domestic carriers even as it awaits certifications for the bigger plane. The development of C919, the nation’s first home-built, single-aisle passenger plane that had its maiden test flight in May last year, is part of President Xi Jinping’s plan to modernize local manufacturing and boost China’s standing with developed countries.
Besides its flagship Hainan Airlines Holding Co., HNA also has a slew of smaller carriers such as Tianjin Airlines, Air Changan, Shanxi Airlines, Fuzhou Airlines and Urumqi Air. The group operates over 1,100 planes, according to its website, comprising an owned and leased mix of Boeing, Airbus and Embraer SA aircraft. In 2010, HNA had committed to buying 15 C919s.
The C919, which would compete with Boeing’s 737 and Airbus’ A320 families, will take about four years to get approvals for airworthiness from the Civil Aviation Adminstration of China, Comac said earlier in February. The C919 has a total of about 815 orders, mostly from Chinese airlines and lessors, while the ARJ21 has 453, according to Comac’s website. Chengdu Airlines, which counts Comac as a major stakeholder, now flies four ARJ21.
HNA is currently in the process of disposing of some of its assets after a global acquisition spree left it saddled with about $94 billion in debt at the end of 2017.
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