Taipei  - Taiwan's China Airlines (CAL), eyeing the huge China market, on Wednesday signed a contract to invest in an aircraft maintenance company in China.

The maintenance company, Taikoo Spirit AeroSystems Composite Co, will be based in Jinjiang in China's Fujian Province. It is scheduled to begin operations in early 2009, with a registered capitalization value of 8.48 million US dollars.

Partners in the join-venture company are CAL, Cathay Pacific Airways, Hong Kong Aircraft Engineering Company (HAECO), Taikoo Xiamen Aircraft Engineering Company (TAECO), First Wave and Spirit AeroSystems.

CAL and Cathay Pacific will each own 7.5 per cent of the new company's capitalized holdings.

CAL, in a statement, said it made the investment decision because of the rapid growth in China's aviation market, and because of the low cost of labour, which meets the company's need for workers and techniques in the area of maintenance with composite material. It will help CAL achieve its competitive advantage with lower cost of maintenance.

Taikoo Spirit AeroSystems Composite Co will provide manufacturing, repair service and after-sales service of composite and metal bond material used in civil aircraft systems. Composites are materials made from two or more substances, which transform dramatically into a composite that is far better than the materials used.

Composite materials offer advantages to aircraft designers. The advanced and lightweight materials are being applied to many aircraft structures to improve performance, and save fuel and maintenance costs. (dpa)