Figures in this article are based on the China Civil Aviation Report, published by the MIIT (Ministry of Industry and Information Technology) in 2017
China’s aviation industry is, as you already know, highly state-driven and composed essentially of state-owned conglomerates.
Historically it has always been considered a strategic industry due to its role as a military asset, although increasing importance has been given to its civil counterpart since the 1990s. In the past 10 years, as the domestic flight market in China has soared, and Chinese leaders have repeatedly hinted at their will to set up an indigenious civil industry. This has been reflected in multiple high level policy papers, such as the 13th Five-Year Plan, and Made in China 2025.
What’s the actual aviation landscape like in China? I have put together some illustrative figures, compiled from the China Civil Aviation Report in 2017 .
Break-down of data on the Chinese Aviation industry
The Chinese aviation industry in 2016 is composed of 152 enterprises, spread over 22 provinces (China has 34, excluding Taiwan). It employs directly 325 000 people.
- Although many major aeronautical strongholds are in the coastal regions, the industry is still surprisingly well spread over the country provided the gap in development between inland and coastal regions.
Top Provinces in terms of civil aeronautics revenue are Tianjin (41,9%), Guangdong (20,6%), and Shaanxi (11%). In the Western region, the aviation industry is strongly concentrated in a handful of areas, namely Chengdu, Xi’an, and Guizhou.
- The size of Chinese industrial players is (surprisingly) large, considering their current position in the global aeronautics market.
With 152 companies employing 325 000 workers, the average Chinese company would have (very roughly) an average of 2138 employees per company. This could hint at potential inefficiencies and redundancies.
Comparatively, France had in 2017 350 000 employees working in over 3 000 aeronautical companies: roughly an average of 117 people per company (although this may be comparing apples and oranges, as the French figures include the defence industry) .
- Most of the Chinese aviation industry is turned towards the defence industry: only a third (roughly) of the industry’s revenue is generated by civil aeronautics.
- A very significant amount of the civil revenue comes from Airbus China (FAL in Tianjin)
The rest is shared among the following (in decreasing order): aircraft parts and aircraft engine manufacturing, MRO, UAV/UAS industry, and indigenous aircraft manufacturing.
- The aeronautical landscape is spearheaded by 3 large state-owned conglomerates: AVIC, COMAC, and AECC, representing respectivement 31% (47), 4% (6) and 9% (13) of all Chinese aeronautical companies.
These figures should be compared to those of 2015, where AVIC was still composed of 63 subsidiary companies, just before the creation of AECC. This highlights the important reorganization of the Chinese aeronautics industry. The same can also be said about COMAC, which was split off from AVIC in 2008.
Revenues of these three conglomerates are less significant than expected, due to the dwarfing effect of Airbus China: 15.1%, 4.5% and 4% of the total industry respectively for AVIC, COMAC and AECC.
 Main source is the China Civil Aviation Industry Report, published by the MIIT (Ministry of Industry and Information Technology) in 2017