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By Winny Wang

China is a step closer to realizing its "super-size" aircraft ambitions with a commercial manufacturing company earmarked for March - and Shanghai the hot venue favorite.

A senior official of the Commission of Science Technology and Industry for National Defense made the announcement on Monday.

A general director and a general designer will oversee the research and production as scheduled, said Huang Qiang, general secretary of the commission.

China will also integrate aviation resources for strategic and professional restructuring, the commission said.

Industry sources said Shanghai is likely to host the research and development work for large civilian aircraft, while Shaanxi Province is expected to take the military section.

Aviation-related industry bases will probably be located in other cities such as Chengdu and Shenyang, sources said.

Large aircraft are planes with more than 150 seats or with a payload of more than 100 tons, including military and civilian jets.

Earlier news reports quoted Gu Huizhong, vice general manager of China Aviation Industry Corp I, or AVIC I, as saying that the country is drafting plans on merging AVIC I and AVIC II to integrate domestic resources, which is widely regarded as an important step in making China's own big plane.

AVIC I and AVIC II, which focus on making military and civilian aircraft, may set up a joint venture to merge their units which produce civilian airliners, according to Shanghai-based China Business News.

The two companies were split from China Aviation Industry Corp in 1999.

AVIC I already builds China's first regional jet, ARJ21. The jet will make its maiden flight in March and the project, costing six billion yuan (US$825 million), is seen as a precursor to China building its own jumbo jets.

The maker has received orders for 171 jets from carriers and plane-leasing units like Shanghai Airlines, Shandong Airlines and Laos Airlines.

Liu Daxiang, a vice president of AVIC I, said last year that China has set a target of completing designs for a large aircraft by 2010, with production to start by 2020.

The move will help the country grab market share from foreign plane makers. Experts said developing a large aircraft will help China master core technologies and diminish its dependence on foreign technology.