British firms hitch onto China’s aerospace boom as Brexit looms


ZHUHAI, China/LONDON, Nov 9 (Reuters) – British electronics manufacturing company TT Electronics is hoping its first attendance at China’s biggest air show with support from UK authorities will help it land a front-seat role in the production of the world’s next wide-body jet.

The Woking-based company is in the vanguard of British companies scouting for business in China this week as part of a charm offensive sponsored by the British government, four months before Britain is due to exit the European Union.

Its interest has been piqued by plans for a wide-body jet to be developed jointly by China and Russia, who unveiled the first life-sized model of their CR929 at Airshow China in a bid to break open the duopoly of Airbus and Boeing.

“If the next twin-aisle aircraft is going to be a Chinese aircraft, we either get involved or we forget about China’s market of twin-aisle for the next 10-15 years,” Ben Fox, business development manager at TT Electronics, told Reuters.

The maker of sensors for planes, trains and hybrid vehicles supplies parts for the Boeing 777 and Airbus A350. But few major new projects are on the horizon and competition is cut-throat in the $800 billion aerospace parts industry.

Britain’s Department for International Trade for the first time set up a UK presence at Zhuhai’s air show, leading a team of seven mostly small and medium-sized companies in the hopes of tapping into China’s rising manufacturing ambitions.

British Prime Minister Theresa May has said Britain wants a free trade agreement with China, as it tries to reinvent itself as a global trading nation after the 2016 Brexit referendum.

The air show coincided with a trade expo in Shanghai where Chinese President Xi Jinping promised to import more amid mounting frictions with the United States and others.

STERLING DROP

Zhuhai’s UK Pavilion “is a demonstration to our Chinese host that we are serious. We put in quite a considerable sum of money to support this and that’s government money,” said Andrew Massey, deputy director for China in the aerospace and aviation division of the Department for International Trade.

Many companies face uncertainty about post-Brexit trade relations with continental Europe, a major outlet for UK-made aerospace parts, and the status of regulation after Brexit.

“There is an element of Brexit forcing people to broaden their horizons which brings opportunity,” said Paul Adams, head of aerospace at consultancy Vendigital.

Britain has the world’s second largest aerospace industry after the United States and is anxious to tout skills and knowledge.

Tangerine, a London-based consultancy that has worked with British Airways, helped design interiors for the CR929 display.

Massey said British companies have also been helping the Chinese to fast-track the FAA/EASA certification process for its smaller C919 jet, which did not appear at this week’s show.

But their trump card may be an 11 percent drop in the value of sterling against the dollar since the 2016 Brexit vote, which has added a hard-nosed dimension to Britain’s global sales drive.

One small British aerospace supplier told Reuters that even though it already sold in 55 countries, the Brexit referendum served as a wake-up call to push for more global markets.

“We’ve done nine exhibitions this year. Brexit is something that will happen and business will get round it but from our point of view we’ve done our first exhibition in Japan and China this year and that’s been very successful, and we’re pushing for markets around the world.” (Reporting by Stella Qiu and Sarah Young; Editing by Tim Hepher and Muralikumar Anantharaman)

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