China’s first homemade large passenger jet, the C919, being pulled out of a hangar during an offline ceremony at the final assembly plant of COMAC in Pudong, Shanghai, China, on November 2, 2015

China has reached a major milestone in its quest to disrupt the Boeing-Airbus duopoly over commercial aircraft manufacturing. In December 2022, the Commercial Aircraft Corporation of China (COMAC) delivered its first C919 aircraft, a narrow-body jet seeking to compete with the Boeing 737 MAX and Airbus A320neo families. COMAC’s nascence (it was founded in 2008), among other issues, has observers doubting whether the C919 can shake up the civil aviation industry. Despite these concerns, it appears that COMAC is in prime position to leverage its home-field advantage to spur adoption of its new aircraft. 

In other words, COMAC, a state-owned enterprise, will compete for sales in the Chinese market and airspace, both of which are regulated by its government owners, who also own the three largest Chinese airlines. The Chinese government routinely subsidizes COMAC, with some reports indicating that COMAC has already received up to $72 billion in development subsidies.