BA Boeing Co

By Doug Cameron 

Boeing Co. said Friday that a planned facility to finish and deliver its best-selling 737 jetliners to Chinese customers would be sited at a new industrial development on Zhoushan island near Shanghai.

The plans first announced last year for a plant to paint planes and install seats and other fittings such as in-flight entertainment systems has already stirred controversy after presidential candidate Donald Trump cited it as an example of U.S. jobs being moved overseas, prompting a sharp push back from Boeing.

The aerospace company will continue assembling 737s at its plant near Seattle but send some planes to China for completion through a joint venture with the state-controlled Commercial Aircraft Corp. of China Ltd.

A separate Boeing-owned delivery center in Zhoushan will oversee the handover of the completed planes.

Boeing has previously said the China facility wouldn't cut employment on the 737 program in Washington state, home to its main assembly facilities.

"The Chinese government has identified Zhoushan and the region as a focus area for development in its 13th Five-Year Plan, and the facility will be an important part of that plan," Boeing said in a statement Friday.

It gave no details about planned opening dates or employment.

The new plant would mark a milestone for Boeing's presence in China, where rival Airbus Industrie SE already assembles some of its competing A320 jets at a factory in Tianjin. Airbus is also establishing one there to finish work on some A330 twin-aisle jets.

Boeing announced its plan in September 2015 during a state visit by Chinese President Xi Jinping to its Seattle factories that coincided with a proposed order for 300 planes.

Boeing recently upgraded its forecast for China's plane demand to 6,800 new planes with a sticker price of $1 trillion over the next 20 years. Boeing and Airbus have a roughly 50/50 split of the Chinese market and are deepening their ties with the country's aerospace industry.

Write to Doug Cameron at doug.cameron@wsj.com

(END) Dow Jones Newswires

October 28, 2016 17:07 ET (21:07 GMT)

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