China asks plane makers to stall deliveries-paper
BEIJING, Feb 8 (Reuters) - Chinese civil aviation
authorities, faced with aircraft overcapacity amid an industry
slump, have asked plane suppliers to postpone deliveries, the
China Daily said on Monday.
Forty three deliveries would go ahead this year as
scheduled, the paper quoted an official with the Civil Aviation
Administration of China as saying.
But suppliers have been asked to delay deliveries for the
next two years, Wang Zhi was quoted as saying.
The decision would be a blow to Boeing and Airbus
Industrie [ARBU.CN], who are battling for dominance in the
world's fastest-growing aviation market and have dozens of
aircraft on order for China.
Ray Bracy, President of Boeing China, cast doubt on the
report.
"It is likely they won't order new planes but we do not
expect they will postpone aircraft already ordered," he said in
an interview.
The China Daily said the 43 aircraft to be delivered
included one Boeing 747, two Boeing 777s, 15 Boeing 737s, three
Boeing 757s and 19 Airbus 320s.
Wang said China would freeze the size of its commercial
airline fleet this year, offsetting the arrival of the 43
planes by taking out of service an equivalent number.
Airlines would try to sell or lease their aircraft, not
renew existing lease agreements and not service aircraft that
have reached retirement age, said Wang, the Director of the
CAAC's Department of Planning, Science, Technology and
Restructuring.
Some old passenger aircraft would be converted into
freighters, he said.
Dong Yuguo, a spokesman for Airbus China, said: "It doesn't
look like there's a threat to the 19 Airbus to be delivered this
year."
"You could say we're very curious," he said, referring to the
China Daily report.
He said roughly 10 Airbus were planned for delivery next
year.
CAAC officials were not immediately available for comment.
After successive years of 30 percent growth, China's
aviation industry began to stall in 1996, the China Daily
quoted Wang as saying. Growth in 1996 was 12 percent, slowing to
7.5 percent in 1997 and 6.3 percent last year.
"Setbacks last year taught Chinese aviation a lesson," Wang
said. "In a sense it is a good thing."
Domestic airlines have been slashing fares on domestic
routes to attract customers as a slowing economy and the
effects of the Asian financial crisis begin to bite.
International carriers such as Air China are having trouble
competing against U.S. and European rivals.
The government plans a shakeout of the industry that will
create several large airline groups through mergers and
acquisitions.
Reynolds Russell
web.idirect.com
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