Airbus agreed on Thursday to build a second assembly line at its Chinese factory and received approval from Beijing to proceed with 160 previously announced plane orders.
The transaction served as a stark reminder of how important China remains for European firms, even as American manufacturers withdraw their investments.
The agreement was signed in Beijing by Airbus CEO Guillaume Faury, who was part of an economic delegation accompanying French President Emmanuel Macron and European Union President Ursula von der Leyen on an ambitious state visit with China's top leader, Xi Jinping.
Airbus is working to increase production of its best-selling A320 single-aisle jet and increase sales in China, whose leaders have recently taken pains to demonstrate that the country is open for business after doubling down on pandemic lockdowns last year.
Under the terms of the agreement, the world’s largest plane manufacturer will double A320 production capacity at its Tianjin factory, in the world’s fastest-growing aviation market.
After trumpeting a major agreement last year in which China promised to buy 292 new Airbus planes worth nearly $40 billion before discounts, the company announced on Thursday that the Chinese government gave approval for Airbus to begin manufacturing 160 of those planes.
Mr. Faury said in a statement that the deal “underpins the positive recovery momentum and prosperous outlook for the Chinese aviation market,” and that the company was “privileged to remain a partner of choice in shaping the future of civil aviation in China.”
The Biden administration has pushed Europe to further isolate Beijing by imposing more trade restrictions on sensitive technologies such as semiconductors that could be used for military purposes.
Economic decoupling is being discussed, and Apple has moved some production to India and Vietnam, though the majority of its revenue still comes from Chinese-made products.
Ms. von der Leyen stated that the EU needed to reduce risk and “rebalance” economic ties with China.
Other European leaders, particularly Mr. Macron, have sought to maintain strong economic ties despite China’s growing assertiveness and support for Russia.
Mr. Macron, who arrived in China on Wednesday, has spent the majority of his visit attempting to carve out a distinct role for Europe that avoids confrontation, while also attempting to provide a role for China in ending the Ukraine war.
Mr. Macron was accompanied by approximately 50 French business leaders in an effort to maintain commercial ties.
The Airbus deal, while smaller than expected, underscored China’s continued importance as a major trading partner for Europe, one that Mr. Macron is unwilling to give up.
Last year, China was the European Union’s third-largest trade partner in terms of goods exports and the largest source of goods imported into the bloc.
France is Europe’s second-largest goods exporter to China, trailing only Germany.
Follow us on Google News for latest Aviation Updates
Join us on telegram group