Middle River Aircraft Systems has been selected to design and build the engine casings, thrust reversers and other components for a new Chinese commercial jet, work that is expected to bring as much as $750 million to the Baltimore-area plant over the next two decades.
The contract could mean dozens of new jobs in Middle River, company officials said, but it also opens a lucrative new market for a plant whose industry - commercial aircraft construction - is foundering.
"This is a tremendous strategic step for us," said Michael Chanatry, executive vice president and general manager of Middle River Aircraft Systems. "It's exactly the kind of business we've been hoping to bring in here."
The 800-employee company, an offspring of the former Glenn L. Martin Aircraft Co. plant on Eastern Boulevard, specializes in building and servicing thrust reversers, the cylindrical device on a jet engine that redirects thrust to act as a brake.
The Chinese jet project is the company's first chance to design and build an entire engine "nacelle" - all of the aerodynamic structures that surround an airplane's engine and direct airflow. Besides creating more work than would a thrust reverser-only contract, the nacelle contract means that Middle River Aircraft Systems will, for the first time, become a primary designer and integrator of a major aircraft component, not simply a "build-to-print" subcontractor.
"We've had this vision here for the last 10 years that we wanted to be a nacelle builder, and now, in a tough business climate, we've proven that we can do it," Chanatry said.
The China Aviation Industry Corp. I, one of China's two primary aircraft manufacturers, plans to build as many as 500 regional jets over the next 20 years. The Asian Regional Jet, or ARJ21, will seat between 79 and 99 passengers and be used for short- to medium-range routes inside China. The final aircraft design is still being developed, but China hopes to have some of the planes flying before the 2008 Summer Olympics in Beijing.
The manufacturer has already agreed to use General Electric Co.'s popular CF34 engine for the two-engine planes. Middle River Aircraft Systems officials learned late Friday that GE has selected the local plant to design and build the engine's nacelle. Middle River Aircraft Systems has been a GE subsidiary since a stock swap in 1997 split it from the Lockheed Martin Corp. operations that still share the Middle River site. But it still had to compete against veteran manufacturers such as Goodrich Corp. and the European manufacturer Hurel-Hispano to win the Chinese business.
Nearly two-thirds of Middle River Aircraft Systems' revenue comes from building and servicing thrust-reversers, mostly for large wide-body aircraft such as the Boeing 747 and 767 and the Airbus A-330. With commercial jet construction diminishing along with the profits of the world's airlines, however, the company has boosted its engineering and design department in the hope of attracting new work.
The plant has gradually added military business and won contracts to design and build structural components for commercial and military aircraft, but still struggles to compensate for dips in the commercial aircraft market, company officials said.
Local executives hope the Asian Regional Jet will be the first of many chances to design and build a system as a lead company. "We'll be managing the aerodynamics all the way from ... the front, through the engine to the thrust reverser," said Pupinder K. Bhutiani, vice president of thrust reverser programs for Middle River Aircraft Systems. "And then we play the role of integrating that engine into the aircraft. It's a whole new business for us."
Design engineers will begin developing the new Chinese components immediately, and the company expects to hire additional workers when production begins in the next few years. Some of the components, made of composite materials or honeycombed metal, will be manufactured in Middle River, while roughly 30 percent will be made in China. All of the components will be assembled in China.