Cessna Aircraft Company, a Textron Inc. (NYSE: TXT) company (through Textron Far East Pte. Ltd.), has entered into a joint venture contract with China Aviation Industry General Aircraft Company Ltd., (CAIGA) (through CAIGA South China Aircraft Industry Co., Ltd.), in accordance with their previously announced strategic agreement, for the formation of a joint venture company to conduct final assembly of Cessna Citation XLS+ aircraft in China for the Chinese market. As the largest general aviation company in the world, Cessna's relationship with CAIGA taps into what is expected to be the highest growth aviation market during the coming decade. Formation of the joint venture company remains subject to various government approvals and customary conditions.
Cessna's Wichita, Kansas operations will provide components and parts manufacturing and sub-assemblies for aircraft to be sold by the joint venture. Joint venture operations in Zhuhai will be designed to conduct final assembly, paint, testing, interior installation, customization, flight testing and delivery of the Cessna XLS+ business jets to in-country customers.
"This is an exciting opportunity for Cessna, given the tremendous growth potential of the region and our ability to bring high quality, proven aircraft that people have come to expect from Cessna," said Scott Ernest, president and CEO.
Management of the joint venture will include board members from both Cessna and CAIGA, with the general manager to be nominated by Cessna Aircraft Company and the deputy general manager to be nominated by CAIGA. "We are extremely pleased with this joint venture contract and we look forward to producing high-quality business jets for the Chinese market," said Bill Schultz, Cessna's senior vice president of Business Development, China. "Customers can expect rigorous testing and quality controls that are the hallmark of our reliable aircraft family."
This joint venture contract stems from the strategic framework agreement that Cessna entered into with CAIGA parent company, Aviation Industry Corporation of China (AVIC), in March 2012.
Source: Textron Inc. (NYSE: TXT)
Date: Nov 14, 2012