China continues to take steps to become one of the world's primary players in the competitive global aerospace market. It now rivals the U.S. in the quantity and quality of aerospace products and services that it manufactures on a regular basis.
It also shows signs of having all of the potential to overtake the U.S. as the world's premier aerospace and technology leader. By all accounts, the future of China's aerospace market looks bright and demonstrates promise that has Chinese and industry leaders excited about what is to come in the next few years.
Much of the credit for China's booming aerospace market can be owed directly to the country's recovering economy. Since 2013, China has experienced rapid growth in its economy. The growth has carried over into the aerospace sector including the manufacturing and sale of private and commercial aircraft.
In particular, the economic growth has boosted the sales and purchases of aircraft designed for business and charter purposes. In fact, China now boasts of 330 jets and 250 turboprop aircraft. These vessels are being used right now primarily for humanitarian, law enforcement, and business travel purposes.
Moreover, close to 61 percent of industry insiders have observed growth in the market with 42 percent of that growth occurring in 2015's fourth quarter. To demonstrate this, one need only look at Gulfstream, which is now the leading global aerospace manufacturer in the Asia-Pacific region. It has 197 aircraft in service in China.
Further, studies now indicate that the Chinese have the luxury of having brand preferences and now specifically prefer aircraft with perks like large cabins. More domestic customers are looking solely to buy aircraft that they can use for private or charter purposes.
The market outlook for China's aerospace industry is so positive and full of promise that the country regularly hosts industry conventions that are now attracting companies and market talent from around the globe. On April 17, the Asian Business Aircraft Conference and Exhibition (ABACE) opened in Shanghai. It attracted 170 different exhibitors and major aerospace global manufacturers, which brought with them 30 different flagship models.
Likewise, China held a Space Day event on April 24. This event attracted more than 2000 attendees and featured state-owned, private, and university enterprises from around the country. It held 12 separate forums on aerospace technology development as well as military and civilian integration, innovation, and education. The event was designed to be a platform on which both domestic and international researchers could exchange ideas.
Another sign that the Chinese aerospace market is faring well is the country's plans to launch a reusable space shuttle by the year 2030. This project also entails the creation and launch of broadband communications networks through the use low-orbit satellites.
It is being carried out via partnerships with companies like the Aviation Industry Corporation of China and China Aerospace Science and Technology Corp. Unlike American space shuttles that must be launched vertically, China's space shuttle is being designed to launch and land horizontally.
All of this promise and potential could be threatened by the tariffs that both the U.S. and China threaten to impose on each other's exports. While the tariffs undoubtedly will hit the American aerospace market hard, it also poses a serious risk to China's particularly since China hopes to export its C919 jets that it plans on making in the next few years. It may not be able to export those jets as quickly or as affordably in light of the American tariffs on Chinese products.
To maintain the growth of its economy as well as its aerospace market, China is now looking to expand trade with countries other than the U.S. and other Western trade partners. It now is considering opening trade and exports of its aerospace products and services to countries in Africa and Asia-Pacific.
Still, China wants to maintain ties with the U.S. and could be extending an olive branch of its own by easing restrictions imposed on foreign auto makers and aerospace manufacturers. The loosening of these rules could allow companies in these industries to open and operate private factories without having to partner with domestic manufacturing partners.
China's aerospace market shows significant promise and potential. The country could become the leading maker of aerospace products and services. Thanks to continued economic recovery as well as a loosening of restrictions on foreign manufacturers, the future of the country's aerospace market remains bright and open.
