Airbus bets on alliances with local companies for growth

Airbus, one of the largest helicopter sellers in the world, will step up its localization strategy and investment in China, a top company official said.

Marie-Agnes Veve, managing director of Airbus Helicopters China, said the company currently has a 37 percent market share in the country's civil and para-public helicopter market and about 300 of its helicopters are currently in operation.

"Close to 1,000 civil turbine and piston helicopters are flying in China, while in comparison, the numbers are 12,000 in the United States and 8,000 in Europe. Government policies for the general aviation industry are also spurring the industry's growth," she said.

The total number of civil helicopters in China is expected to increase to 1,500 by 2020.

Amid the burgeoning market with other competitors expanding their business scale with average double-digit growth, Airbus expects to sustain its top market share in the country. To this extent, the company will continue to take concrete measures to build advantageous local partnerships, she said.

A prime example is the H175/AC352, a joint venture between Airbus and Avicopter, the helicopter arm of the Aviation Industry Corporation of China. The venture seeks to further joint research and manufacturing efforts between the two companies and is based on a common platform from design to mass production. The venture will produce 1,000 helicopters in the next decade.

To date, about 40 H175s have been in service and seven have been delivered to the Hong Kong special administrative region government.

Airbus' Qingdao facilities, which broke ground in May 2017, was based on a framework agreement signed in June 2016 for 100 H135 helicopters. The 100 H135s to be delivered to China represents a total value of about 600 million euros ($662 million).

The assembly line in Qingdao is the first H135 final assembly line outside Europe as well as the first helicopter final assembly line established by a western manufacturer. According to the website of the Ministry of Commerce, the total investment in the facility stood at 100 million euros.

Javier Vicedo, chief representative of China and North Asia region for the European Union Aviation Safety Agency, said more European helicopter businesses are seeking opportunities to build partnership with Chinese counterparts and beef up their investment in the Chinese market. In addition, if the emergency rescue fleet in China could reach the European and US level, thousands of helicopters will be put into service, he said.

Currently, "unsound training systems for helicopter pilots, technicians and maintenance engineers, constraints in infrastructure and low altitude air space ... are hampering the growth."

However, "we are confident that with the further opening of low altitude air space, there will be a huge growth potential in China," she said.