Pontifications: From the aviation perspective, there’s something in China to watch

March 21, 2022, © Leeham News: Eyes are focused on Ukraine and the Russian War. In our corner of the world, commercial aviation, the stakeholders follow the fallout from the war: sanctions placed on Russia which affect overflights, supply chains, oil to Europe (fuel), and Russia’s confiscation of about $10bn worth of airliners from Western lessors and lenders.

By Scott Hamilton

But there is another drama playing out on the other side of the world, too. This one involves China and one of its commercial aviation companies, AVIC.

AVIC is a major aerospace company in China. It also has a variety of none-aerospace companies. It’s one of these that caught our eye last week.

The Wall Street Journal on March 14 reported that AVIC subsidiaries involved in solar energy filed for bankruptcy to avoid an $85m judgment after allegedly absconding with intellectual property from two US companies. The firm had to settle for 30 cents on the dollar.

It’s another example of China companies simply ignoring international IP laws.

The AVIC case

“After years of litigation and under some duress, the Americans agreed to walk away with less than a third of the more than $85 million they were owed under an arbitrator’s judgment,” The Journal wrote.

“The story begins in 2008, when AVIC International USA, one of many AVIC subsidiaries, teamed up with Texas entrepreneur Patrick Jenevein, his company Tang Energy Group, and a handful of other American investors. Under a joint venture known as Soaring Wind, they agreed to work together on wind energy. But the relationship soured. Tang said it learned that AVIC USA’s sister subsidiaries were competing against Soaring Wind,” The Journal wrote.

More IP theft

In June 2021, another Chinese company–Pudong Science and Technology Investment Inc. (PDSTI)–was alleged to steal IP from a US general aviation airplane company. This one included former Boeing CEO Phil Condit, who was on the board of the US firm. Condit and other plaintiffs in a lawsuit alleged PDSTI stripped the firm, called ICON, of technology, value, and sabotaged investment by Japan’s Yamaha.

China’s aerospace industry

China’s aerospace industry (the government, really) has been well known for decades to require foreign companies to share technology as the price of doing business. Western companies, including Airbus and Boeing, were well aware of the ulterior motives—and tactics—of China. They also knew what was not shared voluntarily was subject to industrial espionage.

As far back as 2008-2009, I attended a suppliers business event held by the Washington State Department of Commerce. The purpose was to provide guidance to the state’s supply chain about doing business in China. It was part of a strategy to diversify the state’s aerospace supply chain from Boeing. At the time. Boeing was making a lot of noise about leaving Puget Sound to get away from its militant labor union, the IAM 751, and what it perceived as indifference by state politicians. In October 2009, Boeing announced that its second assembly line for the 787 would be in Charleston (SC).

The suppliers were told about the technology sharing policy required by China. The solution, it was said, was to transfer “yesterday’s” technology while working on “tomorrow’s” technology. All well and good, but China, of course, wasn’t fooled. Cyber-attacks became routine.

China’s aviation progress

China’s commercial aviation progress has been excruciatingly slow. Its first effort, back in the Boeing 707 days, produced the Y-10, the cliché-ridden Chinese copy of the 707. It never flew. Over the coming decades, Embraer located an E145 final assembly line in Harbin. McDonnell Douglas established an MD-80/90 FAL in Shanghai. Bombardier built fuselage sections for the Q400 turboprop and C Series in Shenyang. China built copies of Russian turboprops, which unlike the Y-10 entered service.

But none of these ventures were successful for the “other guy.” The Shenyang operation for the C Series was so deficient that Bombardier—in anticipation—established a backup fuselage center in Canada, which it relied upon for the early airplanes.

Airbus was successful with its Tianjin A320 FAL because it retained control. The Chinese acted more as a subcontractor than the lead.

The difference is seen with AVIC’s development of the ARJ21 regional jet. Obviously derived from the old Shanghai MD-80 knowledge, the ARJ21 carries up to 90 passengers. As one acerbic US consultant once remarked, AVIC reinvented the DC-9-10. The ARJ21 was eight years late. Development was rife with design, assembly, and technical issues. It’s economically a horrible airplane. But commercial success wasn’t the point.

The C919, developed by COMAC (of which AVIC is now a part) unsurprisingly looks an awful lot like the A320. But despite the A320 FAL experience at integration, the ARJ21 lessons learned, and everything else, the development of the C919 has been every bit as bad as the ARJ21. The C919 was supposed to enter service in 2016. Now, COMAC says EIS will happen this year. Don’t bet on it. Next year is more likely, or even 2024.

China and Russia

So, now we get to the CR929, a jet the size of the Boeing 787 and Airbus A330. This twin-aisle airplane is being developed by a joint venture between China and Russia. The EIS target was 2027—another pie-in-the-sky goal set by China’s infant commercial aviation industry.

With the sanctions placed on Russia because of its invasion into Ukraine, the development of the CR929 is going to be problematic at best.


Air Wars

Air Wars is available in paperback and eBook form at Amazon and in paperback at Barnes & Noble.

I write about commercial aviation development in China in my book, Air Wars, The Global Combat Between Airbus and Boeing.

I related the story about Airbus opening its A320 final assembly line in Tianjin. During a press briefing, I asked then-CEO Tom Enders about China’s propensity even then to hack companies to obtain IP. Enders said Airbus had protections in place but in any case, this was just an FAL from which not much in the way of IP could be obtained. But within the first 12 months of the FAL’s opening, the plant was the target of between 6-9 cyber-attacks.

Air Wars also covers labor wars and the 787 line 2 battle. This was followed by Boeing threatening to move the 737 line from Renton for assembly of the 737 MAX and the 777 line from Everett for the 777X unless IAM 751 granted concessions.

Royal Aeronautical Society

Named to the Top 10 List of Aerospace Books for Christmas Choices, 2021

Puget Sound Business Journal

(Seattle area.) No. 1 on the Christmas list of aerospace books for 2021.

BookAuthority

No. 1 on its list of Best New Aerospace eBooks to read in 2022.

Chris Sloan, The Airchive

“A worthy successor to ‘The Sporty Game,’” the 1982 book by John Newhouse, considered at the time to be the definitive book about the competition between Boeing, McDonnell Douglas, and the emerging Airbus.

Jim Sheehan, Aviation Industry Consultant

There is so much model and OEM information that it is for sure going to become required reading for anyone who wants to understand the last fifty or so years of commercial aviation.

Loved all the quotes and stories.

 

 

125 Comments on “Pontifications: From the aviation perspective, there’s something in China to watch

  1. ” Its first effort, back in the Boeing 707 days, produced the Y-10, the cliché-ridden Chinese copy of the 707. It never flew.”

    That’s not quite right – it did fly, but it was only the prototype that ever took to the skies before the project was cancelled in the early 80s.

  2. Many people focus on the Chinese Hardware. Designing the airplane and tooling is the easy part. The Hard stuff is all the standards and specificians for making it happen. How do you drill a hole? That sound so simple but Boeing has a drilling process standard that runs hundreds of pages. Its an exceptionally difficult task to create those, from scratch, in Chinese. There are literally thousands of these process documents needing to be created, and they lack the subject matter expertise western companies have. This is the ultimate IP theft soft target. Its not sexy, and its really hard to protect…..

    • “Many people focus on the Chinese Hardware. Designing the airplane and tooling is the easy part. The Hard stuff is all the standards and specificians for making it happen.”

      I think you can expand that a bit – look at Bjorn’s series of articles about the challenges of designing, building, certifying, introducing, supporting an airliner.
      It doesn’t stop at hole drilling instructions and similar, you need to design and follow the processes to ensure the same quality for every single hole drilled, every single rivet attached, etc. And then you need the wherewithall to keep those planes flying, i.e. support and maintenance, spare parts etc.

      • And that would be so far wrong when it concerns aircraft let alone the Super Tech of Jet engines.

        Aluminum itself is simple. A aluminum alloy (mixed metals for the uniformed) is not. How the alloys are added, when, how its cooled and or additional heat treatment.

        You can analyze what is in it, buy you can’t analysis how it got that way. Ergo, go ahead and reverse engineer and then spend thousands of man hours testing all the possible variables (good luck)

        Jet Engines are hugely complex above and beyond that.

        And the industrialize process (making it at lowest cost with the quality needed) is a further step (which is why RNA vaccines is not in the RNA tech that is hard, its in the mfg process which took many many years to develop)

        That is why simply steeling (pun intended) stuff does not work (by the time you figure it out you are way behind).

        There is not simple single reason why Boeing can’t be replaced, its not hardware alone, its the tech behind the aircraft, landing gear, A/C packs, support and the mfg process of Boeing and all the vendors (or anyone else).

        • “You can analyze what is in it, buy you can’t analysis how it got that way. Ergo, go ahead and reverse engineer and then spend thousands of man hours testing all the possible variables (good luck) ”

          Ever hear of systematic scientific research?
          Not everybody is limited to alchemist surprise finds.

          • Amusing, isn’t it?
            One day we’re told that the Chinese are master copyers, and the next day we’re told that they only manage to copy by sheer luck.
            A very fluid — but always self-comforting — narrative.

          • “Amusing, isn’t it?”

            I’ve long lost contact to the “amusing” aspect.

        • Another nearly incomprehensible comment from our Alaskan sage- but it’s good to know he’s still around.

          “Chinamen is [sic] stupid” seems to be
          that commenter’s rather confused message; we’ll see..

  3. My uncle was head of a union at Northern Telecom in Toronto and fought against the outsourcing of manufacturing to Chinese “interests”. Back in the ‘80’s they were experimenting with hand held devices and switching gear that later went on to become smart phones, people in the factories and offices used them internally, complained about getting brain cancer from them. Long story short, the Chinese companies (i.e. the PLA) drained the computers at Northern Telecom and re-established the company in Shenzhen and named it Huawei. Northern Telecom I think, no longer exist.

    Re. the CR929, I have contacts in Irkutsk who say it will never happen and they (the Russians) are stringing the Chinese along to transfer money from them to UAC. They are contemptuous of the Chinese’ ability to build any kind of aircraft and want it a wholly Russian aircraft like the MS-21. They know they can do it but – politics.

    • I’ve seen this as well. Chinese companies strategically purchase western ones and then slowly acquire their IP. Not just information protected by patents but long won know how and ways to do things. We saw with Kuka but I’ve seen by others. This is not a level playing field free market. There are currency controls and JV that impose tech transfer. It’s an absurd situation. In a few years China’s Ji will be doing the same thing to Taiwan that Russia’s Putin us doing to Ukraine. Exactly the same.

      • Look at the story around “Made in Germany”.
        Every upstart was cavalier about alien rights.
        That definitely includes the US.
        Views change when there has been enough foreign stuff gathered _and_ homesteaded.

  4. Breaking news aircraft crashed into a mountain in China setting of a massive fire all passengers lost.R.I.P.

    • there is a security camera video showing the moments before impace. near vertical dive.

      initial flight tracking data looks like a pitch up, loss of velocity and then plummet.

      horrifying.

      • Rudder hard over? Hopefully will the FDR and CVR have good data to get a clear conclusion fast.

        • looks more like an elevator event, but the data I saw was just flightaware level ADSB data.

  5. I think the main obstacle for the C919 at the moment is its reliance on LEAP engines, and perhaps also its use of certain other “western” parts — all of which are sensitive to sanctions/tariffs. Various sources have reported in recent months that the certification program is being impeded by “lack of spare parts” — which presumably is a reference to “western” parts. Apart from that, the plane would probably already be certified by the CAAC, or very near it.
    Where that’s concerned, UAC followed a more robust route by essentially sterilizing the MC-21 of “western” content.
    I can imagine that the Chinese are already working to remedy this glaring shortcoming in their plan. If anything, the recent sanctions on Russia will strengthen the resolve of the “other side” to become independent of “western” aircraft: after all, when you know that the supply of spare parts can be cut off “just like that”, it’s a good idea to reduce reliance on imports.

    • except that the MC-21 also uses LEAP engines, no? and western avionics? certainly for the export model…

      • MC-21 used P&W GTF in addition to domestic engine. C919 uses LEAP in addition to domestic engine (eventually)

          • Actually the Soviets are in the process of developing an in Russia engine for the MC-21 for internal use (no one else would buy it) after the early sanctions were enacted post Crimea.

            Its not certified per World Recognized Standards and now will not be for an undetermined amount if time if at all as the EASA has terminated all certification of any Soviet product. The USA and the other AHJs will follow.

            The 929 goes down the toilet as well on engines alone as well as other tech.

          • @Transworld, the PW120oG engined MC-21-300 has likely been killed by sanctions. I can’t see it being resurrected unless there is timely withdrawal from the Ukraine and Crimea and regime change in Russia/CIS. The Russified MC-21-310 with PD14 engines and Russian FBW, APU and Glass Cockpit systems is maybe certifiable by 2015. The PD14 may also be Plan B for the C919 but it may be worth supplying the LEAP 1C just to deny Russia the PD14 business.

          • @ William
            There’s currently no indication that sanctions will “kill” anything — delay certainly, but not kill.
            China is moving in to take over the various commodity activities abandoned by “western” companies in Russia, and a whole list of countries/regions (including India, Middle East, Central Asia, Africa, etc.) are continuing “business as usual” with Russia.

          • @Bryce, these are not tariffs being bypassed they are multinational sanctions which are at a whole new level. Putin intimated use of nuclear weapons, directed towards the Baltic and Scandinavian states. Body bags of Ukrainian soldiers and civilians aside He crossed the Rubicon with that and won’t and can’t be forgiven. I myself love Russia and the people(worked there) it’s gone too far. Any nation that aids and abets will one way or another experience consequences. The realpolitik mistakes made in Ukraine of not arming the country to appease Putin are likely to be learned. The parallels in regards to Taiwan are exactly the same. Bullies can’t be tolerated. There has to be a pathway for peace but this can not be rewarded. It’s an opportunity to walk back a lot of foolish and premature trade concessions made to “birds of a feather” Chinese trade as well. Maybe President Biden who ramed through most favoured trading status as a senator nearly 30 years ago carries more credibility than most. Times are about to become interesting. I’m well aware that if Putin ever gets to a war crimes hearing in The Hague he should be preceded by a few Americans but we know that’s not going to happen we will deal with this guy.

          • @ William
            You don’t have to preach to us about the moral desirability of the sanctions.
            The fact of the matter is that a large group of powerful countries is simply ignoring the sanctions — whether the sanctioning parties like that or not.
            You think Russia has crossed the Rubicon — but a large portion of the world simply doesn’t care: they have other interests, other priorities, other agendas. India has quadrupled imports of Russian oil in the past 2 weeks, Saudi Arabia and the UAE didn’t return calls from Mr. Biden — moral grandstanding by the US/EU is not of any interest to them.
            Welcome to the real world — a world in which the old powers have far less influence than they would like to think.

          • @Bryce, there is little difference between Putins Russia and Ji’s China. They’re birds of a feather and China will morally support Russias invasion because it wants to do the same to Taiwan and has done so to Tibet etc. China is an issue that needs to be dealt with one day and it’s better to do it sooner than latter and to do it over Ukrainian sanctions.
            India has issues with China and uses Russia as a balance. India may be morally indifferent to the suffering In Ukrain, I don’t think they are, but they are not morally indifferent to Kashmir. If Pakistan asks to buy some F16 or even F35 they may find a positive US and have a few regrets. The Germans have maybe 6 months to sort out their gas supplies or it’s going to be a cold winter of rationing. Senator Biden made some undiplomatic comments re MBS and these are issues re Yemen and burnt some bridges there. There are ways of working this.

    • Most parts of the C919 has dual sources if imported. This is also true of the engines WS-20 (they use the Russian logic of numbers giving thrust in tons 1000’s kgf). Russians might help with avionics, APU, landing gears for hard cash?

      • Of course the Russians will help — always nice to be able to diversify one’s economy. Plenty of market out there without ever having to go near the US and/or EU.
        As always: sanctioning a technologically competent entity merely incentivizes it to innovate and become more independent.

  6. “…oil to Europe (fuel)…”

    Don’t forget to mention oil to the USA — which is currently a bigger headache than oil to Europe.
    Mr. Biden hasn’t yet found alternative sources for the 3 million bpd of Russian oil that he is self-sanctioning as of April 1. The result is an impending oil squeeze of major proportions. This will inevitably affect aviation.

    https://www.cnbc.com/2022/03/08/analysts-say-alternative-supplies-wouldnt-be-able-to-fully-replace-russian-oil.html

    https://oilprice.com/Energy/Oil-Prices/Oil-Rebounds-As-Market-Fears-Russian-Supply-Shock.html

    • The International Energy Agency is already proposing 1970’s style restrictions on the use of energy and has come up with a set of ten proposals which constitute an action plan.

      Items 8 & 9: Use high-speed and night trains instead of planes where possible,
      Avoid business air travel where alternative options exist.

      • One other option that should have been implemented 10 years ago and that would have prevented the hyperinflation in fuel prices likely to damage the economy is to to have weened folks of oversized cars, SUV, trucks and on to either better designed vehicles or hybrids. There is a 50% saving there in fuel with no loss in safety or comfort. It would have completely avert this crisis. I’m not to condemn anyone who has a farm, frequently must carry a load or trailer for trade but it’s clear such things are mostly unnecessary status and power symbols with a touch of arrogance. So here we are again, an oil crisis. Market forces will come too late once again to avert an economic damage People will suffer and poorer members of the community will end up having to buy cheap but fuel thirsty vehicles on the second hand market. It’s time for regulations.

        • I agree with this, but we shouldn’t forget that a large part of the inflation might come from the massive amount of dollars created in the past years.

          At some level the war sanctions are a welcome excuse for inflation that was already happening or going to happen anyway.

    • the US produces more oil than it consumes. our problem is that many of our refineries are tuned for the chemical makeup of foreign oil (high sulphur venezuelan oil for instance) vs our own because of all those years where we were totally reliant on foreign oil.

      retuning them for US oil is neither quick nor cheap.

      • Experts say US refineries won’t be able to handle sweet crude (from the US) before 2025 at the earliest.

        • The best wells (highest return) are mostly gone. Can frackers maintain/increase their output or return capital to shareholders as output falls off?

          • WSJ

            -> The end of the boom is in sight for America’s fracking companies.

            Seven lean cows follow seven good cows.

            Have Muricans saved up during good years for the future??

          • Fracking can easily pick up the slack (those “diminishing returns” that armchair experts keep spouting off about are easily over a 100 years and growing) if the left will let it.

          • Another case of ignoring reality.

            Enjoy the spring and summer

        • Not sure if they’re sweet “crude”, quite likely NGL and other condensate.

      • Hello Bilbo,

        Re: “the US produces more oil than it consumes. ”

        The US was a net exporter of petroleum products in 2020 and 2021, which includes the products that refineries produce from crude oil, but was a net importer of the crude oil that refineries use to make refined petroleum products. Presently the US produces domestically about 65% of the crude oil used by it’s refineries. See the excerpts below from the US EIA website.

        “In 2020, the United States exported about 8.51 MMb/d and imported about 7.86 MMb/d of petroleum1, making the United States a net annual petroleum exporter for the first time since at least 1949. Also in 2020, the United States produced2 about 18.40 million barrels per day (MMb/d) of petroleum, and consumed3 about 18.12 MMb/d. Even though in 2020, total U.S. annual petroleum production was greater than total petroleum consumption and exports were greater than imports, the United States still imported some crude oil and petroleum products from other countries to help to supply domestic demand for petroleum and to supply international markets.

        The United States remained a net crude oil importer in 2020, importing nearly 5.88 MMb/d and exporting about 3.18 MMb/d. However, some of the crude oil that the U.S. imports is refined by U.S. refineries into petroleum products—such as gasoline, heating oil, diesel fuel, and jet fuel—that the U.S. exports. Also, some of imported petroleum may be stored and subsequently exported.”

        “1 Petrolelum is a broadly defined class of liquid hydrocarbon mixtures that include crude oil, lease condensate, unfinished oils, and products produced from refining crude oil and from processing natural gas plant liquids, including hydrocarbon gas liquids. Volumes of finished petroleum products include non-hydrocarbon compounds, such as fuel ethanol, biodiesel, additives, and detergents, that are blended into the products.

        2 U.S. domestic petroleum production includes field production of crude oil and natural gas liquids, renewable fuels and oxygenate plant net production, and refinery processing gain. Preliminary data for 2020.”

        https://www.eia.gov/energyexplained/oil-and-petroleum-products/imports-and-exports.php

      • “local refineries unfit to process local supply”

        This is not really a brand new unknown unknown issue, is it?

        • Capitalists want to minimize cost, maximize profits, not the other way around.

          Anyway there’s a short fall of crude by 6.422 mbpd last year per EIA.

    • Hello Bryce,

      Re: “Don’t forget to mention oil to the USA — which is currently a bigger headache than oil to Europe.”

      Exactly the opposite is true. The 3 million barrels a day of crude oil the US imported from Russia in December 2021 accounted for only 1.5% of US crude oil imports, whereas in the EU Russia accounts for more than 25% of EU crude oil imports. Losing 1.5% (as in the US) of your crude oil imports will be much less of a headache than needing to worry about losing 25% of your crude oil imports (as might happen in the EU). Also keep in mind that the US produces more barrels of crude oil per year than any other country (but also consumes more), accounting for 65% of US crude oil consumption, whereas in the EU the top producing country is Norway, which is only the 12th largest producer of crude oil in the world.

      See the excerpts below from the 3-8-22 “The Hill” article at the link after the excerpts.

      “Russia is one of dozens of countries that supply oil and natural gas to the United States, which gives the U.S. some flexibility in banning the country’s exports over its invasion of Ukraine.”

      “However, Russian crude oil imports were in decline throughout the second half of 2021. After a peak of 9.6 million barrels in August (5 percent of total U.S. imports), imports fell steadily to 3 million barrels by December (1.5 percent of total imports).

      To put that another way, in December 2021 — when total imports reached about 55 percent of the level of U.S. domestic production — Americans imported about 0.7 percent as much crude oil from Russia as they produced themselves.”

      “With 72 million barrels of oil sent to the United States last year, Russia was the fourth biggest exporter to the U.S., following Canada (about 1.4 billion barrels); Mexico (212 million barrels) and Saudi Arabia (130 million barrels).

      But the U.S. energy supply is highly diversified, and many other nations followed Russia: Colombia (65 million barrels); Ecuador (54 million); Iraq (55 million); Brazil (37 million); Nigeria (39 million); Libya (32 million); Guyana (27 million); and the U.K. (14 million).”

      https://thehill.com/policy/international/597389-heres-where-us-gas-supplies-come-from?rl=1

      • @AP
        No matter how diversified the supply is, there’s no short-term replacement for the 3 million bpd that Mr. Biden has decided to snub. That means that there’s an oil crunch coming from April 1.
        Don’t take my word for it…read what the (US) experts say in the links that I posted.

        • Hello Bryce,

          Re: “Don’t take my word for it…read what the (US) experts say in the links that I posted.”

          Neither of the articles you linked to address your claims that:

          “Don’t forget to mention oil to the USA — which is currently a bigger headache than oil to Europe.” and that that :

          “Mr. Biden hasn’t yet found alternative sources for the 3 million bpd of Russian oil that he is self-sanctioning as of April 1.”

          The CNBC article is about whether it would be possible for the US and its allies to replace ALL the Russian oil that the US and its Allies import, it has zero discussion of whether it would be more difficult for the US or the EU to replace the percentages of Russian crude oil that they import (1.5% and 25 % respectively). The other article is about how sanctions and the threat of sanctions are affecting world oil prices, with zero discussion of which countries would have more or less trouble replacing the percentages of Russian crude oil that they import.

          Many US wells were taken out of production or development when world oil prices dropped to $19 per barrel at the height of the COVID pandemic. As oil prices increased last year, US producers were bringing wells that were not profitable at pandemic oil prices back online or back into development. US crude oil production increases that were planned last year for this by Chevron and Exxon will be more than enough to make up for the 3 millions barrels per month of crude oil that the US was importing from Russia in December 2021.
          According to the excerpt below from the 3-7-22 Politico article at the link after the excerpt, Exxon Mobil and Chevron are planning the following US production increases for 2021.

          Exxon Mobil: 100,000 barrels per day.
          Chevron: 60,000 barrels per day.
          Combined total for Exxon Mobil and Chevron: (100,000 + 60,000) = 160,000 barrels per day.
          160,000 barrels per day x 30 days per month = 4,800,000 barrels per month, i.e. more than enough to make up for the 3 million barrels per month of crude oil that the US was importing from Russia in December 2021.

          “Exxon has said it expected to increase its production from the Permian by 100,000 barrels per day this year, on top of a sharp ramp up last year to 460,000 barrels per day. “We’re well on our way to that,” CEO Darren Woods told an industry conference in Houston on Monday. Chevron has also said it would increase its production there by 60,000 barrels per day this year.

          But even with those sharp increases, keeping a lid on oil and gasoline prices will be difficult if Russia’s 5 million barrels per day of oil exports are taken off the market. The U.S. industry imports only a modest amount of Russian oil and refined products, but trading firms around the world are beginning to shun Russian supplies as governments tighten the financial sanctions on Russia in response to President Vladimir Putin’s invasion of Ukraine.”

          https://www.politico.com/news/2022/03/07/oil-industry-production-hikes-russia-00014778

          Even if the US were not able to increase domestic production at all, it would not take much of a petroleum product price increase to cut demand by 1.5%, and thus put US supply and demand back into balance.

          • The German Government, it’s a green coalition, has been blocking EU exploitation of North Sea oil. The shock of the Ukraine means that they may change. A decision to build a LNG terminal may now also be taken.
            There are actually options to increase oil production. You can make hydrogen out of coal and pump the CO2 into oil wells for sequestration and to enhance oil recovery. You could make gasoline out of natural gas and also sequester resulting CO2 the same way thus eliminating the CO2 emissions issues. The US has coal and Natural Gas and oil wells to sequester in. My guess is using these techniques will produce oil at $35 barrel and have less emissions of CO2. It won’t get to $19/ barrel but it’ll definitely be less than $120. If our OPEC friends are going to leave costs at $100 for too long I’m sure excise, Tarif and depreciation regimens can be worked out to ensure it won’t ever go above $40 again.

          • Germany blocked EU oil *exploitation*??

            If Germany were successful, why there’s so much fear?? 🤣

            EU is not blocked by Germany. EU has no plan to drill in North Sea for oil. 😂

            Germany acts no different than Florida or California. 🤔

          • -> Even if the US were not able to increase domestic production at all, it would not take much of a petroleum product price increase to cut demand by 1.5%, and thus put US supply and demand back into balance.

            People in the know think otherwise

            So far they were proven to correct.

        • Hello Bryce and Dan F.,

          Re: ” there’s no short-term replacement for the 3 million bpd that Mr. Biden has decided to snub.”

          and Re: ” .”U.S. Russian oil imports were 700,000 bpd pre war.”

          According to the American Fuel and Petrochemical Manufacturers website, US Russian crude oil imports averaged 200,000 barrels per day in 2021. What are your sources for the figures you cite? Bryce – did you actually see a 3 million bpd figure or just misread 3 million barrels per month (the amount of Russian crude oil that the US imported in December 2021) as 3 million barrels per day?

          See the excerpt from, and link to, the AFPM website below. Note that 0.2 million bpd = 200,000 bpd.

          “U.S. imports of crude oil averaged 6.1 million barrels per day in 2021 and accounted for about 40% of crude processed by U.S. refineries.

          61% of imports were from Canada; 10% from Mexico; 6% from Saudi Arabia; and 3% from Russia. 2021 crude imports from Russia averaged 0.2 million barrels per day, the highest level in many years,
          but still a small share of total imports and total crude oil processed by U.S. refineries (~1%). U.S. refineries processed 15.1 million barrels per day of crude oil in 2021.”

          https://www.afpm.org/sites/default/files/issue_resources/U.S.%20Imports%20of%20Oil%20%26%20Petroleum%20from%20Russia.pdf

          • @ AP
            I didn’t say that the US *imports* 3 million bpd of Russian oil: I said that Mr. Biden *self-sanctioned* 3 million bpd of Russian oil. That figure includes:
            (1) What the US is/was importing for its own use;
            (2) PLUS what US companies are trading abroad (for non-US use);
            (3) PLUS trade by foreign brokers with large interests in the US, who have stopped trades so as not to run foul of US sanctions.

            The total is ca. 3 million bpd, and it kicks in on April 1. The IEA has described this as the largest shock to the global oil system since the 1970s.

          • Lies, damn lies and statistics.

            Demand in 2022 will be higher than 2021, without **demand destruction**.

            Reuters:

            -> U.S. oil demand rose in December to its highest level since before the coronavirus pandemic began, the U.S. Energy Information Administration (EIA) said on Monday, with product supplied nearing *21 million barrels per day* (bpd).

          • CNBC

            -> “Oil is a global commodity,” said Patrick De Haan, who is head of petroleum analysis at gas price tracker GasBuddy. “We can’t fence the U.S. or take us out of that global system. Just like we’re seeing computer chip shortages — we can’t remove ourselves from that situation either. Even if we produce some supply computer chips here, that doesn’t fix what’s going on outside our borders with drastic impacts to supply and demand.”

        • Hello Dan F,.

          I am suspecting that the 700,000 bpd figure that you cited for “U.S. Russian Oil Imports” was for 2021 Russia to US crude and refined petroleum product imports (includes refined gas, diesel, jet fuel etc.). US imports of crude oil only from Russia in 2021 were more like 200,000 bpd, which has decreased to 57,000 bpd this year, is spite of all those posting here who claim that wildly exaggerated levels of Russian crude imports to the US would be impossible to replace. See the excerpts below from a 3-8-22 Reuters Factbox article at the link after the excerpts.

          “The United States imported 672,000 barrels per day of Russian crude and refined products last year, according to Energy Information Agency data. Of that, 30%, or 199,000 bpd was crude, while 473,000 bpd was refined products.”

          “So far this year, U.S. weekly imports of Russian crude averaged some 57,000 bpd, a decline from the volumes in 2021, the EIA data showed.”

          https://www.reuters.com/business/energy/us-imports-russian-oil-refined-products-2022-03-08/

          • Where’s the replacement of the half a million bpd refined product from Russia? More crude deficit?
            Robbing Peter to pay Paul?

        • There certainly is a short term replacement in the Strategic Petroleum Reserve which has 593 million barrels to draw upon.

      • Price is determined by the market, a global markey. It almost doesn’t matter where your crude comes from, as long as you let it free flow, shortage overseas would increase local price. Simple. It’s economics, St

        • And keep in mind the reason Russian oil was being brought in was also due to the spot nature of the oil market. Other economies went South and Soviet oil was cheap.

          As things picked up it was on a down slope.

          • Russian oil was being brought in so as to make up the shortfall created by sanctioning Venezuela. It wasn’t being sold to the US at a discount.

      • The term Ive seen is the US is ‘self sufficient in oil ‘ when you include Canadian and Mexican production !

        • Aren’t the latter two sovereign nations?

          International law? What international law?? 🙂

          • Mostly just a bigger market right on their doorstep, lower transport costs as well. The Canadian urban areas along the Great lakes- St Lawrence dont have ice free access to ports , so its often shipped in via New England and refined there or pumped to Canadian refineries in Quebec and Ontario. And the Alberta oil sands have direct access to US Markets.
            Then there is Venezuela, large reserves but a non compliant government. Expect a ‘popular revolution’ in next 18 months to replace and fix that problem

          • And again : see the infamity:
            “Their country squats on our resources”

            The US instigated, payrolled, .. “popular revolution” around Mr. Guaido fizzled.

            you think a third one will proceed any better?

          • Pipeline network around the Great Lakes says otherwise.

            Crude from Western Canada now ships from Montreal to refinery at Quebec City down the St Lawrence River. 🙂

            After the invention of Commerce Secretary, our commentators are alive and well, reinvent pipeline network by pipe dreams!

    • U.S. imports of Russian oil were only about 700,000 bpd about 3.5 % of U.S. consumption.

  7. The Chinese industry and government have a long term strategy of becoming fully self reliant and create welfare for its 1.6B inhabitants. To reach that they are investing, learning, developing and stealing IP / knowledge where they can. No doubt also in the case of PDSTI and many other JV’s, take-overs and other cooperation’s and (re) engineering projects too.

    There another state that is the #1 in taking over foreign companies and taking ~ a small decade to rip them of customers, suppliers, IP and selling the rest of their assets. For 50 years already . Even a dozen their government bodies with Billions in their budgets to buy / claim as much foreign IP as possible for themselves. Smart long term strategy, defensive..

    Look around & see their PE firms, multinationals buying, finishing off great family business everywhere, moving production, making people jobless. All legally ok, according to their own laws & business principles.

    No what many want to read, think about or acknowledge. Parked as leftist thinking, ancient anti capitalist ideology or simply progress/ the new economy. Until it hits themselves. E.g. confronted by guys we don’t know, that don’t listen, are hungry for technology and that have even more money in the bank than us, that’s new.

    Not blaming anybody, but gaining IP at the cost of others ain’t anything new and there’s google full of anecdotical evidence.

    • the chinese economy is highly capitalistic, but also totalitarian. you can be a billionaire, but you better tow the party line and have the right friends.

      it also has absolutely no respect for the concept of IP, even internally.

      • IP ceases to be proprietary 20 years after a patent application is filed.
        In that respect, the term “IP” is used very loosely and inaccurately.
        For example, if the C919 really is (largely) a copy of the A320ceo, then there’s probably very little copied tech in the plane that isn’t at least 20 years old — and, thus, no longer categorized as IP.

        As regards more recent tech: one has to ask to what extent it was ever patented in China. If it wasn’t, then the Chinese are free to use it as they wish, as long as it isn’t exported to a country in which it is patented.

        The patent system is full of pitfalls and qualifications.

        • Our commentator forgot what posted on Mar 21 saying the US is ‘self sufficient in oil ‘ when you include Canadian and Mexican production *ONLY*!

          How come Canada has to import oil from drum row pls… *New England*! Where does New England get the crude oil???

          • Oil wells/ tar sands in Canada arent where the concentrated population demand is . 60% probably in narrow belt along St Lawrence river and nearby lakes
            Same reason New England and NE states are likely importers from offshore .
            Some knowledge of geography is required when discussing whats produced where ,and whats consumed elsewhere.

          • Well the day before, North America is oil self-sufficient, today there’s a need of oil import. When are you going to make up your mind??

            As I have posted before, oil is shipped from Montreal to refinery at Quebec City.

            You have to improve your research/imagination. 🙂

    • 1.4 billion, growth rate flat or falling, only about 10 million births last year.

  8. Rudder hard over? Hopefully will the FDR and CVR have good data to get a clear conclusion fast.

  9. Sputnik moment in relation to Russians Hypersonics and soon to be deployed Chinese versions. How could SDI end up like this.
    -“There is currently no policy directing NORAD to defend North America against hypersonic weapons,” VanHerck (Who is NORAD commander) said in a written response to questions from CTV News.
    -The American Air Force general shared the same message with defence officials in Ottawa on Nov. 29, and with the U.S. House Committee on Armed Services on March 8.
    -“I cannot defend, nor am I tasked to defend, against a hypersonic glide vehicle attack,” his prepared statement for the committee read.
    -‘WE CAN’T TRACK THEM AND WE CAN’T KILL THEM’ “

    • The world has known about Russian and Chinese hypersonic missiles for months.
      Both countries also have 5th-generation stealth fighter aircraft. And sophisticated space programs.
      And yet, it’s fashionable to deride the ability of both countries to produce a commercial airliner? Please…

      • The Russian hypersonic program has been known about for 10 years or more. They told us they would develop them in response to a intermediate range ballistics missile defences system proposed to offer some level of protection for Poland. I doubt this is entirely the full reason. The USSR and CIS have always had the issue of dealing with US aircraft carriers. I suspect the deployment of hypersonics is primarily of propaganda value as weapons such as Javelin and NLAWS stall the Russian invasion. . They give no hope in terms of warning time and are unstoppable. They may be a message to Sweden, Finland, Estonia, Latvia, Lithuania all of which would like NATO membership but for Russian/Putin intimidation. The targets receive no warning and can not take shelter. They likely penetrate deep underground. In the most recent case engineers repairing Ukrainian Army vehicles.

        No doubt the Russians and Chinese can make an airliner. The issue is can they make them commercially competitive. For the Russians the massive spending on internal security and military had always sucked the life out of the rest of their economy.

        • They don’t have to be commercially competitive.
          The (emerging) post-globalization credo in the world is “independence supercedes efficiency”

        • The Baltics are NATO members already and Finland and Sweden have long been nuetral by choice.
          Hypersonics is old technology the USAF for it’s own reasons not being very interested until very recently and the contractors being deficent on the small details rather than the core tech

          • -> … the contractors being deficent on the small details rather than the core tech

            KC-46A?? 😂
            A problem/issue is still a problem/issue. From time to time, size doesn’t matter, when the main contractor spent years but problems/issues remain.

            A prevalent blindspot to ignore small details. Titanic was boasted as “unsinkable”. Reality proved otherwise.

          • Its seems Boeing isnt the only one with ‘details’ problems
            As I mentioned a few weeks back

            https://www.opindia.com/2021/12/china-made-aircraft-a-headache-for-nepal-due-to-bad-performance-report/#
            After grounding them for more than a year now, Nepal Airlines is considering dry leasing or selling its six Beijing-made planes.

            Such a shame for those lovely Harbins and Xians

            We can be so sure that the Indonesian defunct carrier which has decided to lease some ARJ21s , such a fine plane. Douglas and Antonov airframe, GE engines , Chinese knowhow, wont be having the same problems. Not at all.

          • @ DoU
            Stunning logic.
            Extending it to Allegiant: it dumped its MDs a few years ago because they had become an unusable maintenance nightmare — so its MAXs will now also be a disaster — right?

          • @Dou

            You are comparing a major military contractor of the world’s Superpower with a tiny aircraft maker that produced only a handful civilian aircraft?

            How far has the mighty fallen. 🤣

            Yeah white supremacists are good source for the holocaust.

            -> The flight suspension comes even as an investigation is pending into a March 28 incident involving an Y12e aircraft of Nepal Airlines which landed some 60 meters short of the runway at Nepalgunj airport and skidded before halting in the nearby grassland.

            -> Weeks after the incident, the flight captain KB Limbu was suspended for “faulty judgement,” according to a preliminary report by the civil aviation regulator, Kathandu Post reported.

            -> Shortage of trained pilots to fly the Chinese aircraft is being cited as another reason for the grounding.

      • So called “Sputnik moment” was mainly an invention. A self-serving way by the military-industrial complex to justify military overspending and enrich the guys at the top.

        History repeats itself because most are dumb.

  10. Lots of comments attached here-to that hijacks the original subject. It’s easier to find them later of they have their own thread.

  11. When MD-80/90 production stopped in China, they were required to dispose of the body jigs but didn’t. ARJ21 is a MD-90 body exactly.

    • They got a new wing design/reshaping done by Antonov as well. But that was paid for . The engines are CF34-10 from GE , which is really a ‘mini CFM-56’ as it has nothing in common with its earlier CF34 cousins

  12. Scott:

    -> Bombardier built fuselage sections for the Q400 turboprop and C Series in Shenyang.

    There’s some serious misinformation here.

    1. BBD has a fuselage supply contract with a subcontractor in Shenyang China.

    2. From a press release from BBD on 2009:

    -> “The test barrel for the CSeries aircraft arrived on schedule, and meets the quality standards equivalent to a final production unit. This achievement underscores the strength of our partnership with Shenyang Aircraft Corporation and China Aviation industry,” said Robert Dewar, Vice President, Integrated Product Development Team, CSeries Aircraft Program, Bombardier Commercial Aircraft.

    3. Both BA and AB suffered delay caused by supply chain issues:

    -> Boeing ran billions of dollars over budget and was three years late in delivering its 787 after failing to keep an adequate eye on its global supply chain.

    -> Airbus faced similar woes with its A380, including an embarrassing situation when it realized the electrical harnesses for the plane produced in Germany were developed using different software than was used in France, where the plane was assembled. Last week, Airbus also announced a six-month delay in the delivery of its A350, which was slated to hit the market around the same time as the CSeries, due to supplier issues.

    https://www.google.com/amp/s/financialpost.com/transportation/bombardiers-bid-to-avoid-boeings-mistakes/wcm/93cf03a6-77ff-4f4e-bbc6-06102373111e/amp/

    Remember that BA had to take over 787 subcontractors’ work in S. Carolina, Scott??

    • ‘The test barrel’ for the CSeries aircraft arrived on schedule’

      Thats when the problems were found during testingin Montreal

      ‘”Bombardier Inc. is about to put a key Chinese-made section of its new C Series to the test in the hope it won’t find major flaws that would force it to alter plans to construct the fuselage out of lightweight aluminum-lithium composites.

      The barrel that could accommodate about 10 rows of seats was recently delivered to the manufacturer’s Montreal plant, following a two-month journey from Shenyang Aircraft Corp., a unit of China Aviation Industry.
      It will now be put to an intense stress testing to mimic the pressure exerted on the structure during 180,000 flight cycles, equivalent to three aircraft lives.”
      https://www.theglobeandmail.com/report-on-business/bombardier-to-put-new-fuselage-to-test/article4283334/

      • Where’s your evidence? Another baseless speculation from the usual suspect? Remember the U.S.’s modus operandi in internet warfare, F.U.D.??

        • So the test barrel arrived on schedule and then later Bombardier used it own resources to build the barrels instead.
          Thats the evidence.
          Its undisputed there were issues with the construction from China.
          Waste of time for Bombardier using that source as the market for the Cseries /A220 remains shut in China. No doubt they prefer their own wonderful but dated planes instead

          • From the same mouth that faithfully repeats BA’s “guidance” for full type approval of 777X is mid or late 2023!

            You never see the writing on the wall?

    • Make the horizontal and vertical scales the same , then you get a typical cone shape to locate the altitude the parts separated . ( Hint smaller parts might not fall vertically depending on winds)
      Maintenance issue or pilot issue , who knows.

  13. Did I read (or imagine it?) that the Air Force Secretary has intimated that Lockheed/Airbus will not be allowed to compete for the tanker contract?

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