Key Takeaways 1

Introduction 3

The Importance of the U.S. Aerospace Industry 4

The Economics of Aircraft Manufacturing—and COMAC’s Illegitimacy 5

China’s Aerospace Ambitions 7

The COMAC C919 and AECC CJ-1000 Engine 9

Innovation Mercantilism in China’s Aviation Gambit 10

Industrial Subsidization 11

Compelled Joint Ventures 11

IP Theft 12

Acquiring Foreign Aerospace Companies 13

Compelling State-Owned Airlines to Buy Domestic 14

Pressuring Foreign Countries to Purchase Chinese Aircraft 15

Underpricing the Aircraft 16

The Importance of China and Emerging Markets 16

Policy Recommendations 17

Technology and Innovation 17

Workforce/Skills 18

Regulation 19

Trade Policy 19

Commercial Diplomacy 19

Export Credit Financing 19

Strategic Trade Partnerships 20

Export Controls 21

Conclusion 22

Endnotes 23