Its Asian alliance is crucial for Bombardier—but will China deliver?
claims it can handle a global supply chain unlike any other system integrator. But following the temporary transition to Canada of key fuselage parts production from its Chinese partner Shenyang Aircraft Corp. (SAC), industry concerns are mounting that the Canadian airframer might have gone too far this time.
When Bombardier built up the manufacturing system for its new 110-149-seat jet family, it allocated development and production of three fuselage sections—forward, center and rear—plus the empennage to SAC. The Chinese supplier is also supposed to build the tail cone and wing-body fairing and, most challengingly, center wing box.
But that work allocation has changed significantly—perhaps just temporarily—as first reported by the Aviation Week Intelligence Network last week. Bombardier itself has taken fuselage assembly to Montreal for the initial set of aircraft, although the components are still to be built in Shenyang. Industry sources also say that several of the work packages that were previously allocated to SAC have subsequently been shifted temporarily to Western suppliers. Spanish aerostructures specialist Aernnova says it has a contract to deliver 40 center wing boxes and tail cones for the CSeries before the work is moved back to China. It is unclear how many sets of fuselage sections are to be built in Montreal, but one executive says at least 10 aircraft could be affected.
Industry executives with insight into the project are not suggesting that the CSeries program is in peril; however, it is clear that Bombardier has been forced to react to considerable problems in airframe manufacturing. Several questions arise from the reallocation nonetheless:
•Will the CSeries development and production schedule be affected?
•What will the program's longer-term industrial setup look like?
•What does the whole process say about the readiness of the Chinese aerospace industry—that not only Bombardier relies on—as an increasingly important part of the global supply chain?
Bombardier says the published schedule is not about to change. The first CS100 is slated to fly by year-end, with final assembly to start in the coming weeks (AW&ST June 25, p. 20). The fatigue-test aircraft is to be ready by September. The manufacturer plans to deliver the first CS100 to a yet-unidentified operator by the end of 2013. That would still be within the range that was originally suggested when Bombardier formally launched the CSeries four years ago on the eve of the 2008 Farnborough air show.
And the company says “it is very common for Bombardier to manufacture the initial shipsets of the more complex work packages of its new aircraft programs. The intention is to share best practices with suppliers while allowing them additional time to ramp up toward volume production.” That approach has always been “in the plan,” says Bombardier. As far as the temporary shift to Western suppliers is concerned, the company states: “There are cases where third-party suppliers overlap work packages, but this is not a reallocated work package.” SAC's mandate “has not changed.”
As to when work will be moved to SAC, Bombardier says: “There is no final date; it's a progressive transfer following the initial shipset production.”
However, industry sources are expressing serious doubts that the overall situation is as unremarkable as Bombardier claims. One executive, who was briefed recently by Bombardier on the status, says that in his observation the production process for the CSeries prototypes is far less advanced than that of the; the program's first flight-test aircraft is scheduled to enter final assembly this month. But the latest Airbus model is slated to fly around half a year later than the CSeries.
One executive says that final assembly of the first unit of a new aircraft should start at least around one year ahead of first flight. The CSeries has not yet reached that milestone. Power-on for the first flying aircraft in any particular program should be reached three to four months ahead of first flight, he notes. The CSeries would therefore have to be at that milestone by September at the latest.
Chinese engineers encountered problems with CSeries manufacturing, but perhaps no more than the usual difficulties that can be expected in a new program, says one industry official in China.
SAC is mainly a combat-aircraft builder and has given some of its CSeries work to its civil offshoot, SACC (Avic SAC Commercial Aircraft Co.), which receives detail parts from SAC and builds the major assemblies for export to Canada. Reviewing the SACC business, President Pang Zhan spoke this year of such challenges as meeting the ever-higher-quality demands of customers, and said his answer was to specialize. The company could not bring together the resources to properly build all parts of an aircraft, he said; so in developing its business, SACC was concentrating on tail sections, doors and engine mountings—a much narrower range of work than what it is doing on the CSeries.
A representative of SAC referred Aviation Week to Bombardier.
One source with knowledge of the situation says it is “shocking that Bombardier has watched [problems unfold in China] and done nothing about it for so long.”
The contracts with Shenyang were announced in 2008 at Farnborough, two days after the formal launch of the program. In August 2009, Shenyang delivered a 23-ft. test fuselage barrel to Bombardier's Saint Laurent plant in Montreal. SAC started construction of the facility in which fuselage sections were to be built in March 2010. Less than two years ago, Bombardier is understood to have contacted suppliers such as Aernnova about stepping in temporarily to build some components. Aernnova delivered the first center wing box to Bombardier in January.
One executive sees the cause of the problem in Bombardier's supply-chain management. SAC could not handle well enough the manufacturer's design tools that are challenging even when using Western data systems with no language barrier involved, he says.
Another industry source hints at the difficulty of gaining Western authorities' approval of Chinese-developed and -produced large subassemblies or sections. Obtaining such approval is easier if production is transferred to foreign suppliers at a later stage, with the initial batch of aircraft being produced at home—Montreal in this case. “China has great difficulty in introducing the right procedures and documentation,” the executive says. Potential rework would be “very time-consuming.”
Xian Aircraft builds-family outer wing boxes to what Airbus calls a high standard, but did not begin doing so until Airbus had been building them for more than 10 years, and at first Xian did not make the complete assemblies. Similarly, SAC supplies wing parts for the A320 and family.
As for Bombardier's involvement with China, the goal has been broader than merely finding cost-efficient and skilled suppliers. Like many other manufacturers, Bombardier sees China as a huge market. According to its latest forecast, Chinese airlines will buy 2,220 aircraft seating up to 149 passengers in the next 20 years—about the same as Europe, Russia and the Commonwealth of Independent States combined. Only North America is still a much larger market (4,700 units).
As a result of that assessment, Bombardier has gone much further than any other commercial-aircraft integrator in its China exposure. That approach is aided by Chinese government funding. Around $400 million in Chinese public money is believed to be invested in the CSeries project, but that money will flow only through the work shares of state-owned suppliers. Bombardier is also forming close links with Chinese manufacturer Comac, which is developing itsnarrowbody airliner. The two companies want to achieve a common cockpit design for the C919 and the CSeries and plan to cooperate in other areas. There have even been suggestions that China might look at buying Bombardier Aerospace outright, although that has not yet materialized. c