Here’s the link to the press release sent out last Friday. The news got scant coverage as it came out too late for most people to pick it up prior to the weekend.
The implications of this agreement are significant. As the statement notes: “The main objective of the bilateral civil aviation safety agreement (BASA) is to support worldwide trade in aircraft and related products. This agreement will remove the unnecessary duplication of evaluation and certification activities for aeronautical products by the civil aviation authorities, and therefore reduce costs for the aviation sector. The BASA will also promote cooperation between the EU and China towards a high level of civil aviation safety and environmental compatibility.” Might unnecessary duplication of evaluation and certification activities for aeronautical products mean that the EU and China are going to set up their own reciprocity for civil aircraft certifications? It sure sounds that way. This then looks like a swipe at the FAA – not surprising in light of the MAX fracas. After all, China grounded the MAX first. Giving further credence to this is the quote from European Commission President Jean-Claude Juncker saying: “In an increasingly unsettled world….”. That sounds like a swipe at the current White House resident. Who also may be short of friends in China these days. Boeing, being in the center of China, the EU, and the White House get hit by the crossfire.
The second agreement signed today is the horizontal aviation agreement. Essentially China now sees the EU as one country and any EU airline can fly to China from anywhere in the EU. This, of course, is going to hinder British Airways and Virgin Atlantic once Brexit kicks in. But it does mean EU-based airlines can look at several interesting new markets and, coincidentally, lots of A321XLR opportunities. These same opportunities are quite likely to attract Chinese airline attention to the A321XLR as well. The absence of the NMA limits Boeing getting any wins from what could be an explosion of secondary city routes. This secondary city activity is attractive for the EU as its big hubs are creaking. For China the chance to bring in direct economic impact from EU tourists in secondary cities is attractive. Then there is the cargo potential. All to the good.
The agreement, in essence, is a signal that the EU and China can create their own aerospace and aviation deals without any concern with Washington’s interests.