On March 1, CGTN reported that commercial aircraft corporation of China, C-O-M-A-C, had won its first commercial contract. China-Eastern Airlines, one of China's largest airlines headquartered in Shanghai, signed a contract to buy 5C-919 jetliners. The first plane is expected to be delivered later this year. Once delivered, the brand new planes are slated to be put into operation in domestic flight routes connecting Shanghai and several other major cities including Beijing, Guangzhou, Shen Zhen, Chengdu, Shaman, Wuhan, and Qingdao. The subject of the C-919 and its development has been a topic that has appeared from time to time on this site. Call it a warning if you like about China's intentions to develop both a plane and an airline industry capable of taking on Boeing and Airbus. As often happens in life, time seems to pass in the blink of an eye and what originally appeared as an event years away arrives much faster than expected. While most of the world ignored its progress, China has rapidly pushed its aviation sector forward. This means going forward, Airbus won't be the only rival Boeing has to contend with. At the time of its first flight, in May of 2017, Bloomberg reported that aviation analysts argued China's claims of a fully homemade aircraft were questionable pointing out that much of the technology inside the C-919 aircraft came from the US and other countries. While Bloomberg and many other sources tried to downplay the event by pointing out the C-919 contained a German landing gear, Franco-American engines, and Austrian-made interiors, China's intentions are clear. The sales of jetliners are very important because they play into the bigger picture of world trade and trade imbalances and China has been a massive battleground for Boeing and Airbus because of the sheer size of its market. China's air travel market is expected to surpass the United States by 2024, according to the International Air Transport Association. Translate that into orders for planes and you're looking at something on the order of 2,800 new planes with a book value of $329 billion. Boeing has projected it could sell China's 6,330 planes worth $950 billion during the next 20 years. Nearly three-quarters of the planes for its civilian airlines will be single-Isle with about 700 wide bodies. The C-919, being built by Chinese state-owned aviation manufacturer Commercial Aircraft Corp of China, COMAC, should send fear into the hearts of Americans. COMAC has spent 11 years and $6.5 billion developing the C-919. This is China's answer to the Boeing 737 and Airbus 320. The C-919 has a flight range of up to 3451 miles, 5555 km, which means it can fly non-stop from Shanghai to Jakarta or from Paris to Montreal and it can fit 158 to 168 seats. This hits right at the heart of its competitors, different models of Boeing 737 can see 85 to 215 passengers, while an A320 can accommodate 100 to 240 people. Politics plays a big role in industry and the Chinese government, which has long aspired to play the plane game, has no qualms admitting its big role in developing the country's aviation industry. Miyao Wei, Vice Minister of Industry and Information Technology, has been quoted saying the government encourages the development of export-oriented aviation products. Times that have appeared on this site over the years have reported on how China was ramping up its fledgling aviation industry and how when it hits its stride we can expect cutthroat competition. These articles warned that as Chinese planes take flight over the next decade America and Boeing may be saying say goodbye to a big chunk of its exports in this field. An article in USA Today in the fall of 2009 focused on the Plan C-919. At the time it was called the Big Plane Project and designed to directly challenge US plane making giant Boeing and European rival Airbus. The article reported the first flight wasn't scheduled until 2014, and the jet wouldn't be available commercially until 2016. But even back then the Chinese manufacturer claimed the twin engine, narrow body design of the C-919 as superior to its competition the Boeing 737, the best-selling jetliner in the world, and its competitor, the Airbus A320. CoMAC had yet to release the price tag of the jet, but a report by China National Radio predicted that it would likely be sold for around $43 million. This is much cheaper than a Boeing 737 or an Airbus 320 which each cost around $80 million $100 million respectively. At the end of 2018, the third C-919 completed its maiden flight at the Shanghai Pudong International Airport. Footage of the flight released by Chinese state broadcaster China's Central Television Station. CoMAC said the plane completed 21 test points during the flight but did not reveal more details of the maiden flight, such as the plane's altitude or speed but in May of 2018, the first C-919 during its maiden flight reached 10,000 feet with a maximum speed of 170 knots or 196 miles per hour. The first two C-919s that took to the skies the year before have been undergoing flight tests in order to obtain flying certification. Three other C-919s were being assembled and expected to complete their first flights in the following year. The chief designer of the ARJ-21, Wu Guanghu, says that CoMAC has turned to new, lightweight carbon composites in place of steel for the plane's construction to gain the 12% to 15% in fuel efficiency. Boeing, which pioneered composite design had difficulty in bringing its first composite plane, the 787 Dreamliner, to market, however, once a company pioneers the way, those following in its footsteps have an easier path. Boeing and Airbus have delayed plans to build more fuel-efficient narrow body planes to replace the 737 and A320 because it cost billions to create a new plane and adding composites won't contribute enough fuel efficiency savings to justify the move. Base isn't the sole factor for airlines in buying a plane, overall quality, reliability, maintenance, and readily available replacement parts, as well as the pilot and mechanic training that manufacturers provide, are also important. Building commercial aircraft has never been a consistently profitable business, manufacturers risk several billions of dollars every time they try to develop a new type of aircraft. The Communist government, however, is playing by a different set of economic rules and using the C919 as a springboard to develop a nationwide aviation industry involving more than 200 companies, 36 universities, and hundreds of thousands of personnel. Some free trade optimists claim China's airline industry has become a private sector industry and ignore the government's influence saying, just because the C919 will be made in China doesn't mean all the Chinese carriers will stop buying 737s and A320s to buy only C919s. They also claim it will be decades before the Chinese will be able to produce anything close to the numbers of planes that the Chinese market will demand. This is not China's first jet, at the end of 2015, COMAC delivered its first new, advanced regional jet for the 21st century, WERJ-21. The buyer, Chengdu Airlines contracted to buy 30 of these new planes and across China, more than 300 orders from various airlines and airplane leasing firms have been placed. The ARJ-21 as Taylor made for the Chinese regional market, it is capable of carrying as many as 90 passengers on trips as far as 1,300 miles allowing it to make direct flights to just about any point in the country. The plane is built with about 50% U.S. supplied parts, including avionics from the well-respected Rockwell Collins and engines from General Electric. The ARJ-21 is the result of a trade delegation led by President Obama back in 2009. This does not impact Boeing which doesn't play in the 90 passengers and below market, but it directly competes with models from Brazil's Embryer and Canada's Bombadier. So where is this going? China is investing big in this vision with its state media touting the advanced technologies that will be used throughout the plane, from new avionics to the plane's frame partially made of light composite materials. COMAC is also developing a wide-body plane, the C929, in cooperation with Russia's United Aircraft Corp. Another company, Avic, is currently working on China's first helicopter factory. The bottom line is that it would be incredibly naïve to underestimate China's resolve in rapidly becoming a player in a field that will move it up the manufacturing food chain. Expect competition in this field to rapidly intensify as new Russian and Brazilian jets also hit the market. With China's experience of building cities from scratch and government-backed financing, why build just one factory when you can build 20? This means we should not expect China's aviation industry to grow organically but to be engineered by an aggressive government with a mission. All this is part of a plan to take China a huge step closer to its trillion-dollar aviation dream of replacing all 6,000 to 6,800 of its western aircraft with its own planes. This translates into a cost of around $1 trillion dollars, with most of the replacements expected to be this single-ile made in China jet. All in all, this makes China's C919 a big deal. China should be considered an adversary and serious rival that should not be underestimated. Over the years China has proven very skilled at industrial espionage and reverse engineering. This means that Duopoly, in the commercial airline market, worth trillions of US dollars which has been enjoyed by Boeing and France-based Airbus is about to end. Other China's C919 is going to hurt Boeing any more than Boeing has hurt itself over the last several years has yet to be seen, or shall we say, is still up in the air. This was the Nomad Economist. Please like, share, leave me a comment, subscribe, and please take some time to subscribe to my backup channels, I do upload videos there too. You'll find the links in the description box. You will also find a PayPal link if you want to make a donation. Thank you wholeheartedly to all those of you who have already donated. Stay safe and healthy friends.