Airbus to inaugurate new China assembly line as treads trade tightrope

Airbus Expands Production Capacity

By Tim Hepher and Sophie Yu

Impact of Trade Relations

PARIS/BEIJING (Reuters) -Airbus is poised to open a second assembly line in China with limited fanfare this week, days after securing an extra foothold in the United States as it walks a tightrope between divided trade powers, industry sources said.

Negotiations with China

The second line at the port city of Tianjin near Beijing will increase Airbus' manufacturing capability for best-selling A320neo-family single-aisle jets, mirroring the addition of a second line in Mobile, Alabama, just over a week ago.

Comparison with Boeing

Unlike the inauguration of its first non-European assembly line, at a high-profile ceremony involving 600 guests in Tianjin more than 15 years ago, this week's expansion will be a relatively low-key affair with no Western media allowed.

Airbus declined to comment.

Industry sources said earlier this month that the two back-to-back ceremonies in Mobile and then Tianjin were being designed to avoid falling foul of a tricky trade climate between China and the United States.

Since Airbus first announced the overseas expansion plans in 2022 and 2023, Washington and Beijing have plunged into a months-long trade war, leaving Airbus and some other European companies anxious to avoid offending either trade power.

Airbus relies on U.S. parts to assemble jets in China and Europe and also depends on smooth ties with the United States, where several of its major airline customers are based.

At the same time, Airbus has been negotiating to sell up to 500 planes to China, a goal first reported by Reuters in April. Sources have said it is likely to secure only part of the order to coincide with the new Tianjin factory expansion.

Boeing has been negotiating a similar 500-plane deal but this remains mired in the back-and-forth discussions over trade, industry sources said, confirming a Bloomberg report.

Airbus is increasing capacity to support higher production of its A320neo family to 75 jets a month in 2027. Doubling capacity at Mobile and Tianjin is part of the industrial plans.

(Writing by Tim Hepher; Editing by Tomasz Janowski and Alexander Smith)