Airbus to Build a Plant in China

European aircraft maker Airbus will build a plant for assembling its A320 series of jetliners in the northern Chinese coastal city of Tianjin, the government said Thursday.

The decision could result in increased sales in China amid fierce competition from Boeing Co.

The National Development and Reform Commission’s Tianjin office made the decision recently, the official Xinhua News Agency said, without giving a date.

Airbus has yet to receive any formal approval from the commission, the Toulouse, France-based company’s spokeswoman in China, Lindsey Mi, told the Associated Press.

The plant would be Airbus’ third assembly line, and the only one located outside Europe.

The two others are based in Toulouse and Hamburg, Germany.

Mi said Airbus would be unable to disclose details of the project until it received official approval.

The Airbus A320 series of twin-engine, single-aisle jetliners is widely used in China, a market dominated by regional routes. In December, Chinese airlines ordered 150 of the planes.

Airbus previously has said that the Chinese assembly line, which is expected to enter into operation at the end of next year, would be capable of producing four A320 aircraft a month -- though this won’t be enough to meet China’s demand for the aircraft.

Analysts said the new plant, if approved, could boost sales for Airbus, which faces fierce competition from its Chicago-based rival Boeing Co.

The China Aviation Supplies Import & Export Group, which buys aircraft on behalf of airlines in China, signed a general purchase agreement in April for 80 Boeing 737-700s and 737-800s.

Boeing executives have said the aerospace company is on the way to matching its sales in 2005 of 120 aircraft to China, the bulk of them 737s, which compete with the Airbus A320 series.

“The growth in the Chinese market for aviation has caused a big increase in the number of orders for narrow-bodied jet aircraft, so to be the first to manufacture the aircraft close to the country may give them a lead in selling it in the local market,” said Andrew Miller, chief executive of the Center for Asia Pacific Aviation, a consulting firm in Sydney, Australia.

Airbus, which is majority owned by European Aeronautic Defense & Space Co. of the Netherlands, last July opened an engineering center near Beijing.

It already buys a small number of aircraft doors, wing components, cockpit floors and other parts from Chinese companies.

In December, the company said it aimed to quadruple purchases in China to $120 million by 2010.