Air China and Rolls Royce Announce Joint Venture for Aircraft Engine Maintenance

New venture could have other wider implications for regional air maintenance

Air China and British engineering giant Rolls-Royce announced the establishment of a new engine maintenance, repair and overhaul (MRO) joint venture in Beijing at the 2022 China International Trade in Services Fair.

The new joint venture, Beijing Aero Engine Services Company Limited (BAESL), will provide MRO support on Rolls-Royce Trent 700, Trent XWB-84 and Trent 1000 aircraft engines. Air China currently has all three engine types in its fleet .

Air China and Rolls-Royce each own 50% of the shares of the joint venture with a contract amount of about 2.61 billion yuan (about $378.2 million).

At full capacity, which is expected to be reached in the mid-2030s, BAESL could support up to 250 store visits per year. The facility will offer MRO services to Air China and other airline customers.

Ma Chongxian, chairman of Air China, said operational safety was a top priority. Air China has long been committed to developing aircraft maintenance capabilities and ensuring fleet reliability, while striving to promote the industrialization of aircraft maintenance.

Chris Cholerton, president of civil aerospace for Rolls-Royce, said the joint venture is an important step for Rolls-Royce in China. “Air China is a strategic partner for us, having grown successfully together for many years. I am delighted to expand our relationship with this exciting partnership in the MRO and look forward to the continued growth of our collaboration.

Ma said Air China and Rolls-Royce will continue to deepen their partnership and cooperation in servicing high-thrust engines in the future.

The JV could, over time, become involved in other regional developments depending on geopolitical changes. China is involved in a Russian JV to build the CR929 passenger plane, which could be operational by 2025-26. This should be powered by Russia’s Aviadvigatel PD-35 engine later this year, while China is working on its CJ-2000 turbojet – Rolls-Royce’s experience may help in the development of these.

In addition, China recently announced with Russia, India and Iran that they would form a an air maintenance consortium will be based in Iran, which would serve both their fleet and other regional fleets. The national airlines of each of them have large fleets of planes, which suggests that a transfer of technology could take place from Rolls-Royce to Air China to allow them to serve both this consortium – and others, to which the two companies alluded in their declarations concerning “regional development”. . India is already a major global player in aircraft parts manufacturing, while Russia has its own aircraft industry.

Rolls-Royce’s move also comes as British politician Liz Truss, who is most likely set to become the next prime minister, announced she intended to label China a ‘serious threat’ – suggesting a significant disconnect in the UK between the policy proposed by the UK government and the objectives of UK business.

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China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors in China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen and Hong Kong. Please contact the company for assistance in China at [email protected] Dezan Shira & Associates has offices in Vietnam, Indonesia, Singapore, USA, Germany, Italy, India and Russia, in addition to our business research facilities along the Belt & Road Initiative . We also have partner companies helping foreign investors in the Philippines, Malaysia, Thailand and Bangladesh.

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