October 07, 2008

BaoSteel and Chalco to join China jet project

Reuters reported that major state owned Chinese firms, including the parent group of Aluminum Corp of China Ltd will invest in a government led project to develop large passenger and cargo jets.

A source familiar with the situation said Aluminum Corp of China the world's fourth largest aluminum producer plans to invest CNY 1 billion in the project, getting a 5% stake. The source said the parent companies of China's top steel mill Baoshan Iron & Steel and state oil trader Sinochem International will also each take a 5% stake.

The source added that the total cost and further details of the shareholding structure of the project will be unveiled after a board meeting scheduled later this month.

The report added that China's two state owned aircraft makers, AVIC I and AVIC II as well as the government of Shanghai where the jets will be assembled and will also help to bankroll the program. AVIC I and AVIC II both supply components for Airbus's and Boeing's latest models, including the double-decker A380 jumbo jet and the 787 Dreamliner. AVIC II unit Hafei Aviation Industry Co also makes the ERJ-145 regional aircraft in partnership with Brazil's Embraer.