Was Split Into Two Divisions In 1999

An executive at China Aviation Industry Corp II says the nation's two state-owned aviation units, commonly called AVIC I and AVIC II, will be restructured to improve global competitiveness.

While an exact timetable is not clear, the source told Reuters, "A restructuring plan will certainly be announced sometime this year."

AVIC I is currently tasked with developing China's first domestic regional jet, the ARJ21, and hopes eventually to challenge Boeing and Airbus. AVIC II's focus is on smaller planes and helicopters.

The two units are not rigidly defined, however. As ANN reported last month, Shenyang Aircraft Corporation (SAC) -- a subsidiary of AVIC I, the big-plane company -- was chosen to build Cessna's upcoming Model 162 SkyCatcher light sport aircraft.

China Daily reports the restructuring is aimed at pooling resources to build a large commercial aircraft, with one plan envisioning the formation of a new company.

Consolidation in the name of global competitiveness would be somewhat ironic. When AVIC was originally split into units I and II in July of 1999, that move also was attributed to a need to be more competitive.

FMI: www.avic1.com.cn/English/EnglishIndex.asp