CompanyGraph
China Aerospace Times Electronics Co., Ltd.
600879 · SSE · China
Builds radar and avionics parts for China's state space and defense programs, where years of certified testing make it nearly impossible to replace.
China Aerospace Times Electronics Co., Ltd. supplies the radar systems and avionics modules that go into CASC Long March rockets and CASIC air defense platforms, where every component must pass years of qualification testing tied to that specific spacecraft before it can fly on a live mission. Because those tests require access to classified command-and-control protocols, a supplier must first hold state-issued security clearances before qualification can even begin — meaning the state controls who is allowed to accumulate the flight heritage that procurement rules then require. Each completed mission deepens that heritage record, so the gap between this company and any would-be replacement widens with every program that flies, and CASC or CASIC switching suppliers would mean restarting multi-year qualification cycles that put active programs at risk. The same clearance gate that locks competitors out also caps the company's own growth, since cleared engineers — not capital or equipment — are the binding constraint on how many qualification campaigns can run at once, and the state, not the company, decides how many people can be cleared.
How does this company make money?
The company earns revenue through long-term fixed-price contracts with CASC and CASIC that cover both the development and production phases of a program. Payments are tied to milestones — completing qualification testing stages and receiving flight readiness certification — rather than delivered monthly. For standardized avionics modules that are ordered repeatedly over multiple years, pricing tiers reward larger volume commitments.
What makes this company hard to replace?
Switching to a different supplier means restarting multi-year GJB qualification testing from scratch for that specific spacecraft platform — a delay that would put active CASC and CASIC programs at risk. Any replacement supplier would also need to hold state-issued security clearances before it could even access the classified command-and-control protocols required to begin testing. Both of those barriers exist at the same time, making substitution a program-level decision with years of consequences.
What limits this company?
The company can only run as many qualification campaigns at once as it has engineers who hold state-issued security clearances. Each campaign is long, classified, and platform-specific. The Chinese state — not the company — decides who gets cleared, so hiring more engineers or spending more money does not automatically mean more capacity.
What does this company depend on?
The company cannot operate without gallium arsenide wafers from Chinese state-controlled suppliers, radiation-hardened microprocessors that meet GJB-150 environmental standards, rare earth permanent magnets for actuator systems, hermetic packaging materials certified for space vacuum exposure, and specialized test equipment for electromagnetic compatibility validation under Chinese military standards.
Who depends on this company?
CASC Long March rocket guidance systems would lose precision navigation capability without this company's parts. CASIC air defense radar networks would experience target tracking degradation. PLA aerospace command satellites would face avionics failures affecting communication and reconnaissance missions. Chinese fighter aircraft programs would run into flight control system integration delays.
How does this company scale?
Circuit board assembly and software integration can be expanded using standard SMT production equipment and automated testing lines — those parts replicate reasonably well. What does not scale easily is the engineering side: designing space-qualified electronics and running classified qualification campaigns requires cleared engineers, and the state controls how many people can be cleared, so that ceiling does not move with capital investment.
What external forces can significantly affect this company?
US semiconductor export controls limit the company's access to advanced chips and manufacturing equipment needed for next-generation avionics. Rare earth material prices can swing sharply, which affects the cost of permanent magnets used in actuators and sensors. International space debris mitigation rules are also pushing requirements for heavier shielding and more redundancy in satellite electronics, adding engineering and material costs.
Where is this company structurally vulnerable?
If Chinese defense procurement authorities revoked this company's security clearances — whether by reorganizing the classified supplier registry, restructuring access tiers, or deciding to consolidate avionics supply inside a different state-owned entity — the same gate that blocks every competitor would block this company too. Its existing heritage records would sit on older platforms with no way to earn new ones on next-generation programs.
Supply Chain
Aerospace Supply Chain
The aerospace supply chain is governed by three root constraints that interact to produce extreme concentration, decades-long supplier lock-in, and a system where every component must be traceable from raw material to flight: certification requirements make every part a regulated article, product lifecycles measured in decades force suppliers to support platforms long after production ends, and integration complexity across millions of parts from thousands of suppliers creates coordination demands that few organizations can manage.
Defense Supply Chain
The defense supply chain is governed by three root constraints that interact to produce extreme supplier concentration, glacial production timelines, and a system where political decisions — not market demand — determine what gets built and how much: monopsony buyer structure means the government is typically the only customer, security classification requirements restrict who can manufacture, supply, and even know what is being produced, and production rate inflexibility means defense manufacturing runs at low volumes with specialized tooling where surge capacity barely exists because maintaining idle lines for contingencies has no commercial justification.