A technician dismantles a retired A320 which has been in service for 22 years in Hefei, East China's Anhui Province on December 7, 2021. Photo: VCG

Airbus has signed a Memorandum of Understanding (MoU) with the city of Chengdu and Tarmac Aerosave for the development of the first sustainable aircraft "life-cycle" service center in China. 

Market watchers said the project will help strengthen weak links within China's aviation maintenance industry, and establish a more mature aviation maintenance sector, bringing the country closer into line with mature aviation markets.

This agreement will cover a range of activities from aircraft parking and storage, to maintenance, upgrades, conversions, dismantling and recycling services for various aircraft types, according to the release sent to the Global Times on Tuesday. 

With an investment of no less than 6 billion yuan ($950 million), the project is expected to store a total of 685 aircraft, 98 dismantled aircraft, and 21 passenger-to-cargo aircraft by 2030.

The development represents a further concrete contribution to the aviation industry's quest for sustainability, supporting the principle of a circular economy. This unique facility will support the expansion of Airbus' aviation services while enabling the implementation of China's "Green Industry strategy," according to Klaus Roewe, SVP for Airbus Customer Services.

A rendering of the proposed Airbus aircraft life-cycle service center Photo: Courtesy of Airbus

Aircraft phase-out in China is forecast to grow exponentially over the next 20 years. Airbus is committed to investing in the region and this one-stop-shop - a first in China and outside of Europe - will see Airbus well positioned on the Chinese aircraft 'second life' services market, he added.

A formal agreement to establish and frame this industrial cooperation is planned to be signed between the partners in mid-2022, with an entry into service of the new center slated for the end of 2023, subject to relevant regulatory approvals, Airbus said. 

Tarmac Aerosave will bring its 15 years of proven expertise in eco-efficient aircraft dismantling to the project. Located in the same center, Airbus subsidiary Satair will acquire ageing aircraft, trade and distribute the resulting used parts to complete the full scope of life-cycle services. The facility will cover a surface area of 690,000 square meters, with a storage capacity of 125 aircraft.

Market watchers said that the design life of most commercial aircraft is about 30 years, but after 15 to 20 years of operation, it is necessary to consider decommissioning due to higher failure rates and maintenance costs. Aircraft can either be converted into a cargo aircraft or disassembled with the parts reentering the aviation material market to enhance the use value of the aircraft.

Data from Cirium Fleets Analyzer showed that since the 1990s, 200 jets originally owned and operated by Chinese airlines have been sold to foreign companies, at an average age of 16.8 years, of which, nearly 90 percent were passenger planes. 

Over the same period, more than 140 passenger aircraft originally operated by Chinese airlines were converted into freighters, at an average age of 18.5 years, while just over 130 aircraft have been permanently retired by Chinese airlines, at an average age of 17.2 years.

A 2020 forecast concluded that there will be nearly 2,500 passenger aircraft due to be retired in China over the next 20 years, of which around 550 will be converted into freighters, with around 2,000 set to be dismantled.

In recent years, the National Development and Reform Commission (NDRC) and Airbus have held an annual aerospace summit aimed at deepening bilateral cooperation. 

In 2019, the NDRC and Airbus conducted a special study on the issue of aircraft full-service and recycling, ultimately deciding to build an Airbus aircraft full-life service cycle facility in China.

As is common in aviation, the main manufacturer leads industry chain development. Tianjin is an example. Airbus' first aircraft assembly line outside Europe was unveiled in the municipality in 2008, designed to assemble the A320 series single-aisle aircraft. 

In 2017, Airbus inaugurated its A330 Completion and Delivery Centre in Tianjin, Airbus' first wide-body completion and delivery center outside of Europe.

The Tianjin government said that the industrial output value of the aviation industry cluster increased by 15.5 percent year-on-year over the first three quarters of last year. 

Chengdu is the third city in Chinese mainland with dual international hub airports. The total scale of its aerospace industry has exceeded 80 billion yuan, according to Chengdu Daily on Wednesday.