Shanghai Electric Group Co, China's biggest maker of coal-fired power equipment, said it plans to buy 30 passenger planes to develop an aircraft leasing business on the Chinese mainland.

SE Leasing Co, 95 percent held by Shanghai Electric, will sign a memorandum of understanding with AVIC I Commercial Aircraft Co for the planes purchase.

China's strong economic growth and an increase in middle-class travelers have been pushing domestic need for transport and travel, boosting sales for major plane makers.

China agreed to purchase 150 A320 planes from European aircraft giant Airbus, which also plans to set up a final assembly line in the country, its first outside Europe.

China Aviation Industry Corp I, is the country's biggest aircraft maker. It is now designing its own ARJ-21 plane, which is meant to be the nation's first contender in the market for mid-range jets.

The aircraft, which will seat 70 to 90 passengers, is due to make its maiden flight in 2008 and has already received 41 orders from Chinese carriers such as Hainan Airlines Co and Shanghai Airlines Co.

In September, AVIC I started construction of a new plant in Shanghai's Baoshan District to handle production and research and development of the ARJ-21. The facility is designed to produce 30 planes a year after its first-phase wraps up next year. It will ultimately have a production capacity of 50 aircraft.

Shanghai Electric said it doesn't expect to receive its first aircraft or to commit itself to any major payment obligations over the next three years.

Source:佚名