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 TIME on politics Congressional Quarterly CNN/AllPolitics CNN/AllPolitics - Storypage, with TIME and Congressional Quarterly

Manufacturing Processes

page 1


Machine tool and jet engine technologies are priority acquisition targets for the PRC. This chapter presents two case studies relating to the PRC╠s priority efforts to obtain such technology █ its 1994 purchase of machine tools from McDonnell Douglas, and its efforts in the late 1980s and early 1990s to obtain jet engine technology from Allied Signal╠s Garrett Engine Division.

McDonnell Douglas Machine Tools

In 1993, China National Aero-Technology Import and Export Corporation (CATIC) agreed to purchase a number of excess machine tools and other equipment from McDonnell Douglas, including 19 machine tools that required individual validated licenses to be exported. CATIC told McDonnell Douglas it was purchasing the machine tools to produce parts for the Trunkliner Program, a 1992 agreement between McDonnell Douglas and CATIC to build 40 MD-82 and MD-90 series commercial aircraft in the PRC.

During the interagency licensing process for the machine tools, the Defense Technology Security Administration sought assessments from the Central Intelligence Agency and from the Defense Intelligence Agency, because of concerns that the PRC could use the McDonnell Douglas five-axis machine tools for unauthorized purposes, particularly to develop quieter submarines. Since the PRC wishes to enhance its power projection capabilities and is making efforts to strengthen its naval forces, the five-axis machine tools could easily be diverted for projects that would achieve that goal.

Initially, CATIC told McDonnell Douglas it planned to sell the machine tools to four factories in the PRC that were involved in the Trunkliner commercial aircraft program. When those efforts reportedly failed, CATIC told McDonnell Douglas it planned to use the machine tools at a machining center to be built in Beijing to produce Trunkliner parts for the four factories.

In May 1994, McDonnell Douglas applied to the Commerce Department for licenses to export the 19 machine tools to the PRC. Even after it became apparent that only 20 of the 40 Trunkliner aircraft would be built in the PRC, the U.S. Government continued to accept McDonnell Douglas╠ assertion that the machine tools were still required to support the Trunkliner production requirements. Accordingly, Commerce approved the license applications in September 1994 with a number of conditions designed to limit the risk of diversion or misuse.

In April 1995, the U.S. Government learned from McDonnell Douglas that six of the licensed machine tools had been diverted to a factory in Nanchang known to manufacture military aircraft and cruise missile components, as well as commercial products. However, Commerce╠s Office of Export Enforcement (OEE) did not initiate an investigation of the diversion for six months.

The Commerce Department declined an Office of Export Enforcement Los Angeles Field Office request for a Temporary Denial Order against CATIC. The case remains under investigation by OEE and the U.S. Customs Service. With the approval of the U.S. Government, the machine tools have since been consolidated at a factory in Shanghai.

Garrett Engines

The PRC has obtained U.S. jet engine technology through diversions of engines from commercial end uses, by direct purchase, and through joint ventures. Although the United States has generally sought to restrict the most militarily sensitive jet engine technologies and equipment, the PRC has reportedly acquired such technologies and equipment through surreptitious means.

Prior to 1991, Garrett jet engines had been exported to the PRC under individual validated licenses that included certain conditions to protect U.S. national security. These conditions were intended to impede any attempt by the PRC to advance its capability to develop jet engines for military aircraft and cruise missiles.

The 1991 decision by the Commerce Department to decontrol Garrett jet engines ensured that they could be exported to the PRC without an individual validated license or U.S. Government review. In 1992, the Defense Department learned of negotiations between Allied Signal╠s Garrett Engine Division and PRC officials for a co-production deal that prompted an interagency review of Commerce╠s earlier decision. The interagency review raised a number of questions regarding the methodology Commerce had followed in its decision to decontrol the Garrett jet engines.

The PRC continues its efforts to acquire U.S. jet engine production technology. The PRC may have also benefited from the direct exploitation of specially designed U.S. cruise missile engines. According to published reports, the PRC examined a U.S. Tomahawk cruise missile that had been fired at a target in Afghanistan in 1998, but crashed en route in Pakistan.

Manufacturing Processes PRC Efforts To Acquire Machine Tool and Jet Engine Technologies


The People╠s Republic of China╠s long-term goal is to become a leading power in East Asia and, eventually, one of the world╠s great powers. To achieve these aims, the PRC will probably enhance its military capabilities to ensure that it will prevail in regional wars and deter any global strategic threat to its security.1

From the PRC╠s perspective, the 1991 Gulf War was a watershed event in which U.S. weapons and tactics proved decisive. The war provided a window on future warfare as well as a benchmark for the PRC╠s armed forces.2

After the Gulf War, senior PRC military leaders began speaking of the need to fight future, limited wars "under high-tech conditions." 3 Senior PRC political leaders support the military╠s new agenda.4

In a 1996 speech, Li Peng, second-ranking member of the Politburo, then-Prime Minister, and currently Chairman of the National People╠s Congress, said:

We should attach great importance to strengthening the army through technology, enhance research in defense-related science, . . . give priority to developing arms needed for defense under high-tech conditions, and lay stress on developing new types of weapons.5

Senior PRC leaders recognize that enormous efforts must be made to "catch up" militarily with the West.6 According to the Defense Intelligence Agency, the PRC╠s ability to achieve this goal depends in part on its "industrial capacity to produce advanced weapons without foreign technical assistance." 7

Two technologies that have been identified as priority acquisition targets for the PRC are machine tools for civil and military requirements, and jet engine technology.8 This chapter presents two case studies relating to the PRC╠s efforts to obtain such technologies █ its 1994 purchase of machine tools from McDonnell Douglas, and its efforts in the late 1980s and early 1990s to obtain jet engine technology from Allied Signal╠s Garrett Engine Division.

These case studies illustrate the methods the PRC has used to acquire militarily-sensitive technologies through its skillful interaction with U.S. Government and commercial entities.

However, the case studies do not assess the degree to which the PRC has enhanced its aerospace and military industrial capabilities through the acquisition of U.S. technologies and equipment.

A third technology priority for the PRC █ composite materials █ is discussed in the Technical Afterword to this chapter.

PRC Targeting of Advanced Machine Tools

The PRC is committed to the acquisition of Western machine tool technology, and the advanced computer controls that provide the foundation for an advanced aerospace industry.

Although the PRC acquires machine tools from foreign sources in connection with commercial ventures, it also seeks foreign-made machine tools on a case-by-case basis to support its military armament programs.

Moreover, the proliferation of joint ventures and other commercial endeavors that involve the transfer or sale of machine tools to the PRC makes it more difficult for foreign governments and private industry to distinguish between civilian and military end-uses of the equipment.

The China National Aero-Technology Import-Export Corporation╠s (CATIC) purchase of used machine tools from McDonnell Douglas, now part of Boeing, is one illustration of the complexities and uncertainties faced by private industry and the U.S. Government in these endeavors.

Traditional machine tools cut, bend, and shape metals and non-metal materials to manufacture the components and structures of other machines. Machine tools form the foundation of modern industrial economies, and are widely used in the aerospace and defense industries.

The capability of machine tools is typically indicated by the number of linear or rotational motions █ of either the tool or the workpiece █ that can be continuously controlled during the machining process, and by the machining accuracy that can be achieved. The latter is measured in microns, that is, millionths of a meter.

Advanced machine tools can provide five axes of motion █ typically horizontal, lateral, and vertical movement, and rotation on two perpendicular axes. Less widely used or required are six- and seven-axis machines, which are sometimes used for special applications.

Machine tools used in aircraft and defense manufacturing today are generally numerically controlled (NC). More advanced equipment is computer numerically controlled (CNC). CNC machine tools are essential to batch production of components for modern weapon systems, and can reduce machining times for complex parts by up to 90 percent compared to conventional machine tools.

In addition, these modern machines require operators with less skill and experience and, when combined with computer-aided design software, can reduce the manufacturing cycle of a product, from concept to production, from months to days.

Machine tools are essential to commercial industry, and high precision, multiple-axis machine tools broaden the range of design solutions for weapon components and structural assemblies. Parts and structures can be designed with advantages in weight and cost relative to what could be achieved with less advanced machine tools. For military and aerospace applications, the level of manufacturing technology possessed by a country directly affects the level of military hardware that can be produced, and the cost and reliability of the hardware.9

The military/civilian dual-use production capability of various types of machine tools is indicated in the following table.

Table 1: Some Military and Civilian Uses of Machine Tools

Machine Tool Type

Conventional Military Applications

Nuclear Applications

Civilian Applications

Precision lathes

Inertial guidance system parts; High performance fuel-pump parts; Tank transmissions.

Parts for uranium enrichment centrifuges and laser isotope separation.

Automotive transmissions; VCRs; CDs, computer components

Diamond turning lathes

Reflecting mirrors for laser gyros; Harpoon missile advanced optical system


Molds for contact lenses; Prisms for optical equipment; Computer hard drives

Large center-drive lathes

Gun barrels for 120 and 150 mm cannon (external cuts)

(No critical application)

Turbine shafts; Large motor shafts; Propeller shafts


Stabilization and aiming systems for M1A1 Tanks; Airframe and missile parts

Enrichment Components

Instrument brackets; Large computer frames; Airframe parts

Large five-axis mills

Aircraft parts; Propellers for Navy ships and submarines

(No critical application)

Aircraft parts; Propellers for commercial ships

Small five-axis mills

Jet engine impellers

Enrichment components

Compressor pumps for fluids


Radar systems for aircraft; Inertial guidance system parts; Helicopter main shaft bearings; Gas turbine blades; High performance fuel pumps

Enrichment components, tooling and fixturing

High speed motor shafts and bearings; Automotive injector valves; Dies, molds, pumps.

Source: Export Administration Regulations, Part 742.

Back  |  Forward


pages 1 | 2 | 3 | 4

PRC Acquisition of U.S. Technology
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

PRC Theft of U.S. Nuclear Warhead Design Information
pages 1 | 2 | 3 | 4 | 5

High Performance Computers
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

PRC Missile and Space Forces
pages 1 | 2 | 3 | 4 5 | 6 | 7 | 8 | 9

Satellite Launches in the PRC: Hughes
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

Satellite Launches in the PRC: Loral
pages 1 | 2 | 3 | 4 | 5 | 6

Launch Site Security in the PRC
pages 1 | 2 | 3 | 4 5 | 6

Commercial Space Insurance
pages 1 | 2 | 3 | 4

U.S. Export Policy Toward the PRC
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9

Manufacturing Processes
pages 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10

pages 1 | 2 | 3

pages introduction | A | B | C | D | E | F

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