BEIJING - CHINA'S two major aircraft makers are likely to join forces as part of the nation's ambitious efforts to build a domestic passenger jet that would rival Boeing and Airbus, state media said on Thursday.

China Aviation Industry Corp I (AVIC I) and AVIC II, both state-owned, may consolidate their commercial aircraft manufacturing businesses and set up a new firm to assemble the plane, the China Daily reported, citing company sources.

The move is aimed at 'strengthening the country's aviation manufacturing capabilities' and 'pooling resources to carry out the large commercial airplane project', said an unnamed official with AVIC II.

Shareholders of the joint venture, apart from the two companies, will include state-owned investment companies and Chinese airliners, according to the report.

China announced early last year that it planned to develop a 150-seat passenger aircraft, which could eventually compete against planes made Boeing and Airbus, the world's two dominant commercial jet makers.

The aircraft, expected to take off by 2020, will be assembled in Shanghai, with the nose, fuselage and tail sections to be manufactured in other parts of the country by companies controlled by AVIC I and AVIC II, it added.

AVIC I and AVIC II are both component suppliers for Boeing and Airbus.

AVIC I is also the manufacturer of the 70 to 100-seat ARJ-21, China's first home-made passenger airliner that rolled off the production line last month.

AVIC II is the country's only producer of military and commercial helicopters. It has a joint venture with Brazilian plane maker Embraer to build the 50-seater ERJ-145 regional jet. -- AFP