Boeing announced on Friday it will set up a completion facility and delivery center for its on-demand 737 jetliners in Zhoushan City of east China's Zhejiang Province.

The airplanes will be initially assembled in Renton then sent to Zhoushan, where the interiors installation, aircraft painting, and delivery to customers will be carried out. A framework agreement was signed on Friday between the Zhejiang Provincial Government, the Boeing Company, and Commercial Aircraft Corporation of China (COMAC)

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While the installation and painting jobs at the finishing facility is a joint venture between Boeing and the Commercial Aircraft Corporation of China, the delivery center is solely owned by Boeing, the Herald Net reported.

"This facility will support Chinese customers and enhance Boeing's market access to the world's largest airplane market," the company said in a statement on Friday.

"This facility in China will increase Boeing's 737 production capacity and will not result in layoffs or reduce employment for the 737 Program."

However, Boeing refused to give specific details such as opening dates and employment, according to the Wall Street Journal.

The initiative comes after both Boeing and its European rival Airbus Group compete through China's aircraft market. The Airbus Group already has an A320 assembly line in Tianjin, China, and last year, it announced it will open an A330 finishing and delivery center, Global Times noted.

The move also comes as COMAC tries to break its single-aisle aircraft market. In November last year, COMAC launched its commercial-based jetliner C919 to compete with the two giants. COMAC said it received more than 500 orders from 21 different China-based firms.

TagsBoeing, Airbus, Airbus Group, Comac, aircrafts, airline industry