Helicopter Firm to Pour US$380m into R&D
(Source: China Daily; issued Sept. 27, 2006)
China Aviation Industry Corp II (AVIC II) plans to pour more than 3 billion yuan (US$380 million) into the nation's fledgling civil helicopter industry. The money will be spent on research and development (R&D) and co-operative projects with foreign counterparts during the 11th Five-Year Plan (2006-10).

"In the next five years, we will stick to a market-oriented approach, boosting the helicopter industry in terms of R&D and manufacturing capability, marketing and servicing," Ni Xianping, deputy chief engineer of AVIC II, the country's only State-owned helicopter maker, told China Daily. "After figuring out our clients' specific market demands we will develop new products and redesign existing ones to meet them."

Specific projects in AVIC II's five-year plan include a brand new 5.5 to 6-ton commercial helicopter, which will be entirely self-developed, and several joint programmes with international counterparts, said Ni.

During the 10th Five-Year Plan period (2001-05), AVIC II made significant breakthroughs in mastering new key rotor, transmission and avionic systems technologies under the international China Medium Helicopter programme.

Those developments are now allowing the company to work on its new 5.5 to 6 ton multi-purpose commercial helicopter, which will fill a blank in the domestic market. "Therefore, it will take less investment to roll out the new helicopter," said Ni, although he did not reveal how much the new project will cost.

The new helicopter will be powered by the latest version of the PT6C-67C engine, produced by Canada's Pratt & Whitney. It is intended to fulfil domestic needs for passenger and cargo transport, offshore services, and corporate use.

The major development work for this version of helicopter is scheduled to be completed during the 11th Five-Year Plan period, and the helicopter will be certified and enter service during the 12th Five-Year Plan period (2011-15).

Ni believes working on the helicopter's development themselves will enhance AVIC II's engineers' R&D capability, allowing them to grasp core technologies in helicopter design and production. Meanwhile international co-operation should provide an opportunity for China to roll out advanced products in the short-term.

The deputy chief engineer said AVIC II is currently working on a one-ton light helicopter with a foreign partner. He could not release more details due to commercial reasons. "Negotiations are still ongoing. We expect to reach a final agreement soon," said Ni.

AVIC II last year hammered out a deal with Eurocopter, an affiliate of the European Aeronautic Defence and Space Company, to jointly develop a multi-purpose helicopter.

The Chinese national helicopter maker will invest 300 million euros (US$360 million) in the joint programme, which it is an equal partner in, during the 11th and 12th Five-Year Plan period. "It is, so far, the largest co-operative programme we have been involved in. The designing of the helicopter is running to schedule," said Ni.

Regarding co-operation with foreign partners, AVIC II is also working at sub-contracting manufacturing projects. The Chinese helicopter and light aircraft maker is busy negotiating with a Western counterpart on a new outsourcing manufacturing contract. The contract will produce the airframe of a helicopter for the Western company.

"The value involved will not be significant. However, the sub-contracts will keep us well informed and updated on the latest developments in the global helicopter manufacturing industry," said Ni. AVIC II already produces the airframe of the US Bell 430 helicopter under a sub-contract.

Besides the new helicopters AVIC II plans to make either by itself or in partnership with international counterparts, the company is also to redesign its existing products and produce more tailor-made new models catering for clients' specific demands.

The modifications and customization will involve AVIC II's flagship products, such as the Z-11, Z-11MB1, Z-9A and Z-9H425.

"We believe civil helicopters have a bright market perspective with the Beijing Olympics and Shanghai World Expo on the horizon," said Ni. "As market demand increases, the industry will provide more opportunities for further technical development."

According to AVIC II's market research, there will be a robust market demand for as many as 2,763 civil helicopters in China by 2026.

The State has made developing helicopters and other aircraft a clear priority during the 11th Five-Year Plan period. Yet despite the strong market potential, there is a big restriction on AVIC II's plans. "The country's long-standing restriction on the use of airspace below 3,000 metres is a big concern," said Ni.

It was once reported that China is likely to open most or even all of its low-altitude airspace around 2010. But the Air Traffic Control Committee of the Central Military Commission has never confirmed the news.

AVIC II's ultimate target is to squeeze into the top level of world helicopter makers by 2020, in terms of both product portfolio and production value.

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