European plane maker Airbus SAS has agreed to set up a US$22 million venture in Beijing for engineering and technical services, its Chinese partners said on August 28.

Airbus will take a 70-percent stake in the venture, Hafei Aviation Industry Co and Jiangxi Hongdu Aviation Industry Co said in separate statements to the Shanghai Stock Exchange.

The new unit will operate a research center that provides engineering, aircraft component design, consulting and training services to Airbus and its affiliates and customers in China and abroad, according to the statements.

Hafei will own 18 percent of the venture, and Jiangxi Hongdu will hold seven percent. The remainder will be owned by China Aviation Industry Corp I.

Airbus now runs an engineering center in Beijing, and the new venture will take control of it.

Hafei, Jiangxi Hongdu and AVIC I have partnered with Airbus in an assembly plant venture in the northern port city of Tianjin for the France-based company's first Chinese-assembled A320 passenger plane.

The Tianjin facility will become Airbus' first assembly line outside Europe. Airbus is controlled by European aerospace and defense group EADS. Local assembly in China could reduce Airbus' costs and deepen ties with the Chinese aviation industry.

Airbus and US-based rival Boeing Co expect China to become the world's second-largest aircraft market after the United States, with airlines buying thousands of planes over the next two decades to meet booming air travel demand.

Airbus has estimated that the number of passenger planes is likely to triple to 2,700 by 2025 on the Chinese mainland from 760 at the end of 2005.