According to a report by COMAC, the 2025 COMAC Supplier Conference was held in Xi'an on March 20, with more than 800 representatives from 229 suppliers around the world participating. According to the official account of Aviation Power Future, COMAC's procurement volume in 2024 is close to 20 billion, and the procurement volume in 2025 is expected to increase by 70% compared with 2024. The substantial increase in procurement volume indicates that C919 is expected to speed up the full batch production, and is expected to vigorously promote the development of the large aircraft industry chain. According to estimates, it is estimated that the total value of the domestic passenger aircraft market from 2021 to 2040 will be nearly 3 trillion yuan, with a compound growth rate of more than 20% and a market share of more than 30%. Proportion of value: 36% of the airframe structure, 30% of the airborne system, and 22% of the power plant.

The main views of Zheshang Securities are as follows:

The production capacity of C919 aircraft will be revised upwards in 2025, reaching an annual output of 200 aircraft in 2029, and the full batch production of C919 will be accelerated

1) Production capacity upward revision in 2025: According to the Shanghai Municipal Commission of Economy and Information Technology in February 2025, the production capacity of C919 is expected to reach 50 aircraft in 2025. According to the official account of Aviation Power Future, the production capacity of C919 will be increased to 75 aircraft in 2025, and the production capacity will be revised by 50%.

2) Production capacity will be increased again in 2029: According to the official account of Aviation Power Future, the production capacity of C919 aircraft is planned to be 50/75/100/150/150/200 aircraft from 2024 to 2029. As a major aircraft manufacturer, COMAC's five-year rolling capacity planning is of great significance to the production rhythm of the industrial chain. In 2029, the production capacity will exceed the upper limit of 150 aircraft, an increase of 33%, exceeding market expectations.

　　3) C919 full batch production accelerated: According to the official account of Aviation Power Future, COMAC's procurement volume in 2024 is close to 20 billion, and the procurement volume in 2025 is expected to increase by 70% compared with 2024. The substantial increase in procurement volume indicates that C919 is expected to speed up the full batch production, and is expected to vigorously promote the development of the large aircraft industry chain.

The bright operating data of C919 lays the foundation for the acceleration of batch production, and the European airworthiness certification will open up the global market space

1) Bright operational data: According to Flight Steward data, by the end of 2024, a total of 16 C919s have been delivered, including 10 by Middle East Airlines, 3 by Air China, and 3 by China Southern Airlines. In December 2024, the average daily utilization rate of the C919 fleet reached 7.1 hours, and compared with the mainstream narrow-body passenger aircraft A320 and B737, the utilization gap of C919 was further narrowed to 1 hour, which is a significant improvement. The excellent operation performance of the C919 has laid a good foundation for the C919 to speed up batch production, which will help airlines to advance the rhythm of receiving aircraft and help production capacity continue to ramp up.

2) European airworthiness certification promotion: According to the observer network, Yang Yang, deputy general manager of COMAC Marketing Center, said that the C919 passenger aircraft is expected to fly international routes in Southeast Asia in 2026 and obtain European airworthiness certification as early as 2025. C919 European airworthiness certification is expected to open up the global market space, especially in Europe. According to COMAC's forecast, by 2040, China's passenger aircraft fleet will account for 22% of the world's total, and Europe will account for 20% of the world's total.

Market estimate: It is estimated that the total value of the domestic passenger aircraft market from 2021 to 2040 will be nearly 3 trillion yuan, with a CAGR of more than 20%.

1) According to COMAC's forecast, China is expected to become the world's largest single aviation market by 2040. From 2021 to 2040, China's aviation market will receive 9,084 passenger aircraft, of which single-aisle passenger aircraft account for 69%. 2) According to the estimation of Zheshang Securities, it is estimated that the total value of the domestic passenger aircraft market from 2021 to 2040 will be nearly 3 trillion yuan, with a compound growth rate of more than 20% and a market share of more than 30%. Proportion of value: 36% of the airframe structure, 30% of the airborne system, and 22% of the power plant.

Investment suggestions: pay attention to the investment opportunities of the large aircraft industry chain, and recommend the benefits of C919 batch production speed

1) Airframe manufacturing: AVIC Xifei (000768.SZ) (C919 largest airframe supplier), Zhongzhi Co., Ltd. (600038.SH) (C919 vertical tail, flap slat), AVIC Shenfei (600760.SH) (C919 rear fuselage, vertical tail, hanging, etc.); Pay attention to AVIC Chengfei (002190.SZ) (C919 nose).

2) Engine localization: Hangfa Power (600893.SH) (supporting domestic engines), Hangfa Control (600893.SH) (domestic engine control system), Focus on Hangya Technology (688510.SH) (compressor blades).

3) Airborne system: pay attention to AVIC airborne (600372.SH) (airborne system), AVIC Optoelectronics (002179.SZ) (connector), Sichuan Jiuzhou (000801.SZ) (call system), Andawell (300719.SZ) (cabin equipment), Quanxin (300447.SZ) (cable), Jianghang equipment (688586.SH) (environmental control system).

4) Parts/materials: pay attention to AVIC Heavy Machinery (600765.SH) (aviation forgings), Triangle Defense (300775.SZ) (forgings + section assembly), Aileda (300696.SZ) (parts), Guanglian Aviation (300900.SZ) (composite tooling + parts), Runbei Aviation (001316.SZ) (aviation materials).

5) New materials: pay attention to Baoti Co., Ltd. (600456.SH) (titanium alloy), Western Superconductor (688122.SH) (titanium alloy), AVIC Hi-Tech (600862.SH) (composite prepreg), Zhongfu Shenying (688295.SH) (civil carbon fiber), Fushun Special Steel (600399.SH) (ultra-high strength steel).

Risk Warning

　　1) The batch production rate of C919 is not as fast as expected; 2) The localization rate of C919 is not as good as expected.