The northern port city of Tianjin beat three other domestic cities in a six-month competition for Airbus' first aircraft assembly plant outside Europe.

"Tianjin has been selected after a thorough evaluation according to multiple criteria, such as seaport proximity, airport characteristics, labour and industrial capabilities," Airbus said in a statement yesterday.

The A320 assembly line will be built in the Binhai New Area by the end of this year. The first aircraft is expected to be delivered in 2008 and the plant will be able to produce four jets a month by 2011.

The facility is expected to boost Airbus' sales in China and improve the know-how of the domestic aviation industry.

A consortium of enterprises, which comprises several leading companies in Tianjin, China Aviation Industry Corp I (AVIC I) and China Aviation Industry Corp II (AVIC II), will set up a preparatory team with Airbus to launch the project, according to the National Development and Reform Commission (NDRC), the nation's top economic planning body.

Both the NDRC and Airbus declined to specify the total investment. It was reported earlier that the whole project would cost 8 to 10 billion yuan (US$1-1.25 billion).

Tianjin is 120 kilometres southeast of Beijing; and Binhai is 50 kilometres away from the coastal city's downtown.

The announcement follows a central government decision on Monday to create a new economic growth engine in North China rivalling the Pearl River Delta in the south and the Yangtze River Delta in the east.

The State Council designated the 2,300-square-kilometre Binhai New Area an experimental zone for comprehensive reforms.

The Tianjin municipal government and the General Administration of Civil Aviation of China last year signed an agreement to build a State base for the industrialization of civil aviation technologies in Binhai. The Tianjin airport authority plans to build a new runway for the test flight of A320s, and a US$3-billion reconstruction and expansion of the airport was launched last August.

"All those factors gave Tianjin an edge when competing with Shanghai, Xi'an and Zhuhai (the cities which were in the running)," said Ma Xiaoli, an analyst at CITIC Securities.

"The construction of the final assembly line will drive the growth of aviation-related manufactures in North China and be a strong boost to the local economy," Ma said.

The assembly line could also help train top-quality experienced engineers and technicians, which would create a talent pool for China to make its own large aircraft, Ma said.

China will start making large aircraft with more than 150 seats before the end of the 11th Five-Year Plan period (2006-10).

The country started to build large aircraft in 1970. Its first large aircraft made the maiden flight in 1980 but failed to gain a foothold later.

Five Chinese companies from AVIC I and AVIC II produce parts for Airbus aircraft, including wing components, rear passenger doors and emergency exit doors of A320 aircraft.

The single-aisle A320 family aircraft is the most successful model of Airbus.

The company last year delivered 289 A320s. China flies 220 A320s, accounting for 80 per cent of the total number of Airbus aircraft in the country.

Airbus has two A320 assembly lines: one in Toulouse, France, the other in Hamburg, Germany.

Source: China Daily