A research report from a securities firm indicates that large aircraft and commercial aero-engines represent a core high ground in China's high-end manufacturing sector, possessing substantial industrial potential and strategic importance. Civil-military integration is also a key pathway for defense enterprises to expand their growth ceiling. Commercial aero-engines, being a critical "chokepoint" in the industrial chain, directly determine the level of self-sufficiency and control for domestically produced large aircraft. As the airworthiness certification and installation testing of the CJ-1000A engine progress steadily, related catalysts are expected to materialize continuously. The report suggests that the domestic large aircraft industrial chain has officially entered a fulfillment period. Recommendations include focusing on: 1) segments with high localization rates that benefit from the rapid batch production of the C919, such as raw materials and airframe structural components; and 2) segments with currently low localization rates but significant future potential after full localization, such as engines and onboard systems. The main viewpoints are as follows:
Large aircraft hold immense strategic and economic value. They are considered the "jewel in the crown of industry," significantly driving national economic growth, with their strategic value far exceeding their economic worth. Currently, the global commercial trunkliner market is long-dominated by Airbus and Boeing, leaving a substitution potential potentially reaching trillions of dollars for domestic alternatives. The domestically developed C919 jet has over 1,600 orders in hand, positioning its manufacturer to break the overseas duopoly and become a third major player in the global trunkliner market.
The domestic large aircraft industry is entering an accelerated fulfillment phase. Key indicators include: 1) Accelerated capacity building: The C919's second-phase final assembly line expansion project is advancing, comprehensively enhancing mass production capabilities. The manufacturer has explicitly targeted an annual production capacity of 200 aircraft by 2029, matching robust order demand, representing an increase of approximately 33.3% compared to the previous interim ceiling of 150 aircraft per year by 2027. 2) Accelerated delivery pace: The C919 delivered only 15 aircraft throughout 2025, with 9 delivered in the fourth quarter alone, including 8 aircraft in November and December. Third-party institutions forecast that C919 deliveries could exceed 28 units in 2026, supported by hundred-aircraft orders from major domestic airlines, indicating sustained delivery volume growth. 3) Product serialization and commercialization: The aircraft family, covering different seating categories, includes variants like a plateau version and a stretched version based on the base model, broadening application scenarios. C919 fleet utilization rates continue to climb, reaching an average daily utilization of 6.2 hours and 3.1 flights per aircraft annually in 2025, nearing mainstream industry levels and demonstrating significant commercial operational effectiveness. 4) Accelerated breakthroughs in overseas airworthiness certification: In 2026, the European Union Aviation Safety Agency completed compliance test flights for the C919, providing a "good performance, safe and reliable" assessment. Following the submission of compliance documentation, the C919 is expected to enter service in the EU and over 90 other countries worldwide. Internationalizing the airworthiness system promotes full alignment of the supply chain and after-sales standards with global benchmarks, laying the groundwork for challenging the Airbus-Boeing duopoly. 5) Accelerated independent development of domestic commercial engines: Reliance on the LEAP-1C engine, subject to US and European export controls, has been a "chokepoint." The domestic counterpart, the CJ-1000A engine, has entered the airworthiness certification phase, accumulating 6,142 hours of extreme testing by January 2026. The engine manufacturer is accelerating its IPO process, with capital markets poised to support the localization of this core component.
Regarding the C919 industrial chain, the localization rate is expected to continue rising. The C919 program deeply integrates the global supply chain using a "main manufacturer-supplier" model. At its first flight in 2017, the overall localization rate exceeded 50%, including production by domestic companies and Sino-foreign joint ventures within China. While the C919 initially uses imported LEAP-1C engines, the domestic CJ-1000A is expected to be gradually installed in the future. Onboard systems, involving avionics and electromechanical systems, are currently dominated by foreign and joint venture companies, with domestic substitution still in its early stages. Benefiting from accelerated deliveries and increasing localization rates, based on scenario analysis, the estimated average annual market size for the C919 airframe from 2026 to 2035 is approximately 106.9 billion yuan.
Potential risks include delays in aircraft deliveries, slower-than-expected development progress for commercial engines/onboard systems, and fluctuations in industry demand.
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