Much news recently on China’s plans to go into commercial jet plane production. Two reasons why I have not posted on this until now.  One, I almost never bother posting on what is purportedly going to happen; there is plenty to post about on what is happening. Second, I did not take this news seriously.

But that is exactly why I am posting now.

Seems the Wall Street Journal and I think alike. Yesterday’s Journal has an article written by Bruce Stanley (out of Hong Kong) and Andrew Batson (in Beijing), entitled, China’s Air Ambitions Face Obstacles: Beijing Hopes to Tap Lucrative Market Dominated by Boeing and Airbus, expressing strong doubts as well:

Some aviation-industry executives argue that marshaling the necessary resources to build serviceable passenger jets is only part of the challenge, with some saying the effort could take longer than China expects. They say that, beyond the significant technical hurdles, China will face challenges when it tries to market its unfamiliar planes to airlines, provide customer support and spare parts for them and secure approval to sell them abroad.

“They put a man into orbit. We know that takes a lot of interlinked technical competences,” says Martin Craigs, president of Aerospace Forum Asia, a business group of suppliers to the airline industry in Asia. “But it’s not just industrial engineering. It’s the finessing of the commercial with the technical and all the huge responsibilities of planning and certificating large commercial aircraft.”

There are doubts China will be able to keep up with the new composite aircraft coming out from Boeing and Airbus and because the planes almost certainly will require “Western avionics and engines,” there are even doubts regarding China’s cost advantage. Most importantly, there are concerns Chinese planes just will not sell:

Selling such planes without a track record or reputation for customer service and support won’t be easy. Chinese state-run airlines are semi-independent of the government and may not want to buy them. Foreign buyers could be even harder to find.

“The airlines are not picking a product — they’re getting married to a supplier for a long, long time,” said Mr. Craigs, who has worked as a marketing executive for several European aviation companies in China.

We here in Seattle like to joke about our friends over at the Lazy B, but the reality is that both Boeing and Airbus took a long long time to get where they are and this is not a business known for its shortcuts. China will not be a force in commercial airplanes by 2020 or even 2030. In the meantime though, it might be a clever way for it to angle for discounts.

What do you think?

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Dan Harris

I am a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

I mostly represent companies doing business in emerging market countries. It has taken me many years to build my network and it takes constant communication and travel to maintain it. My work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

I was named as one of only three Washington State Amazing Lawyers in International Law, I am AV rated by Martindale-Hubbell Law Directory (its highest rating), I am rated 10.0 by AVVO.com (its highest rating), and I am a SuperLawyer.

I am a frequent writer and public speaker on doing business in Asia and I constantly travel between the United States and Asia. I most commonly speak on China law issues and I am the lead writer of the award winning China Law Blog (www.chinalawblog.com). Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed me regarding various aspects of my international law practice.

I am licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at my firm, I focus on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.