TIAN Min CFO Commercial Aircraft Corporation of China, Ltd. May 12th, 2010 C919 Airplane & China Civil Aviation Market

China civil aviation market develops continuously and steadily C919, the plane that meets the need of China’s aviation market

（Ⅰ） Introduction of China’s economy and aviation transportation development China’s economy and aviation transportation development for the next 2 decades are forecast as follows (Hong Kong, Macao and Taiwan excluded) according to the estimation of World Bank and other relevant authorities, the annual average growth rate of China’s GDP is 6.6% annual average growth rate of RPK ： 8.2% annual average growth rate of RTK ： 10.2% newly delivered planes ： 3795 (the above data source: Aviation Industry Development Research Center )

( Ⅱ） Current situation and development trend of China’s economy and aviation transportation development The Quick Development in Air Transportation Industry: Over the past decade, with the positive influence of sustained growth of Chinese economy, especially with the fast development in import, export and tourism, together with the change in citizens’ consumption structure and growing pace of urbanization, the average annual growth rate of total turnover of air transportation reached 15%. The share of air transportation in mass transportation system increased from 1.6% in 1978 to 12.3% in (data source: Aviation Industry Development Research Center ) The RTK of China keeps increasing. The growth of RTK of China civil aviation ( ) Billion ton- km RTK

The Fast Expansion in the Scale of Air Transportation: There were 523 planes in Chinese Airliner fleet in 1998, while the number reached 1400 in The number of air line increased to 1532 in 2008 from 1122 in By the end of 2008, there were 41 airline corporations having independent legal entity status. (data source: Aviation Industry Development Research Center ) The fleet scale expands continuously. Fleet Development Chart ( ) No. of planes Number of seats in the fleet of China Aviation in 2009: Single-aisle planes account for 80% year

The Accelerated Construction of Civil Aviation Infrastructures: By the end of 2008, there were 160 civil airports (HK, Macau and Taiwan excluded). The number planned will reach 244 in Infrastructures, such as civil aviation operation centre, meteorological centre, multi-area control centre, and the terminal control centre, will be put into construction. Austere Challenges Faced by Air Transportation Industry: The cost increase in fuel forced airline companies to adopt plane types with lower running costs ； In hub airports, the increase of flights is restricted by the air traffic flow control. The large scale construction in high speed railway will exert significant impact on domestic short-distance flights. Chinese civil aviation will face more fierce competition in the international market. Low carbon economy and Europe emission legislation will exert important influence on air transportation industry and aviation manufacturer. (the above data source: Aviation Industry Development Research Center )

( Ⅲ )The Driving Force of China Civil Aviation Market Development 1. The steady economic growth of China is the main driving force for China Civil aviation development. In 2009 ， China’s GDP reached trillion yuan, increasing by 8.7% compared with that in The economic globalization and external economic and cultural communication provide the important source of passengers for aviation transportation. 3. The urbanization rate keeps increasing. According to the statistics of State Statistics Bureau, the urbanization rate of China increased from 30.9% in 1999 to 46.6% in It is estimated that the urbanization rate will reach 55% to 60% after 20 years.

4. The fast development of traveling industry is the important factor for promoting domestic civil aviation transportation development. The World Tourism Organization forecasts that by 2020 China will become the top tourist destination country and the fourth largest outbound tourist country. 5.The income level is continuously growing year after year, The residents' consumption structure has been upgraded. More people choose airlines as their way of traveling, which becomes the driving force for China aviation transportation industry growth. According to the statistics of Civil Aviation Administration of China, a person in China takes an average of 0.17 flight in 2009, with considerable growth potential (North America being 2.3 times) 6.The airport construction accelerates. By 2020, the total number of civil airports planned for China will reach 244; over 80% of the county administration units can enjoy aviation services within 100 kilometers of ground transportation or 1.5 hours of cars range. (the above data source: Civil Aviation Administration of China, 2008)

( Ⅳ ) China Aviation Market Forecast( ) (data source: Aviation Industry Development Research Center ) Civil planes demand forecast ( ) 座级： seats

China civil aviation market develops continuously and steadily C919, the plane that meets the need of China’s aviation market

（Ⅰ） C919 Program's Market Positioning The domestic large commercial aircraft of C919 program is now being developed by COMAC. C919 program chooses domestic market as the entry point and gives equal consideration to global market. Providing serialized development mode with different seat numbers and flying range (Including: basic, shortened, lengthened and altiplano models and so on) to meet the various demands of customers. C919 airplane standard model flight range: 2,200NM (4075km), lengthened model : 3,000NM (5555km).

The C919 airplane is to supply single-aisle mid-short range commercial transport airplane series to the civil aviation market after 10 to 20 years with safe, comfortable, energy-saving, environment-friendly features and with competitiveness. The seating capacity of Basic model all economy class is 168 seats, while mixed class is 156 seats. Compared with same seat airplane, it decreases the emission level of carbon by 50% and kerosene consumption by 12%-15%, DOC by 10%. ( Ⅱ )The Green airplane --C919 airplane

Cabin layout Mixed class Full economy class

New Generation Engine Leap-X New generation Leap-X engine, developed by CFM company Up to 13% lower fuel consumption vs CFM db lower noise vs ICAO Stage 4 50% lower NOx emissions vs ICAO CAEP 6

World-class System Suppliers APU (Honeywell/Harbin Dongan) Environmental control system (Liebherr/Nanjing Jincheng) Power system (Hamilton Sundstrand/Air China 115 factory) High lift in flight control system (Moog/Qingan) Hydraulic pressure system (Parker/Nanjing Jincheng) Furl system (Parker/Nanjing Jincheng) Primary flight control actuator (Parker/Air China 618 Institute)

( Ⅲ ) C919 airplane provides the opportunities for the China’s civil aviation C919 airplane can meet the operating demand of China’s civil aviation between big and middle city and short international routes. C919 airplane provides more aircraft type choice for route operation ， and replaces old age narrow-body aircraft. With low operation cost, C919 meets the operation demand of low cost airline companies. The local customer-support will release the operation's worry for China’s airline companies. C919 airplane provides more cabin comfort and bring better service for passengers.

( Ⅳ )Research Plan and Project Progress of C919 Program C919 airplanes are planed to have the First Flight at the end of 2014, and come into service after obtaining TC in The C919 program is now entering into the pre-development phase. Breakthrough has been achieved in many fields, such as further development of concept design, research and development of nose engineering coordination mock-up, selection of domestic and international suppliers, research and development of domestic-made materials, tacking key technologies and establishment of maintenance support.

Summary C919 airplane can meet the development need of china civil aviation market, bringing profit to clients and satisfaction to passengers.

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