After more than a year of preparatory work, a joint venture company will be launched on Sunday in Shanghai to develop and build the country's first large airplanes, the Shanghai Securities News reported on Wednesday.

The aim of China Commercial Aircraft Co Ltd will be to manufacture passenger jets with at least 150 seats, enabling it to compete with Boeing and Airbus in the fast-growing aviation market.

Its first aircraft are scheduled for takeoff by 2020.

The company's first tasks will be to develop an operating structure and a research and development center, a source close to the project was quoted by the newspaper as saying.

The R&D center, which will employ 2,000 staff, will be based at the Shanghai branch of the First Aircraft Institute under the China Aviation Industry Corporation I (AVIC I).

The institute currently has 700 staff, who previously designed the 50 to 60-seat MA60 turboprop aircraft and the 70 to 90-seat ARJ21 regional jet.

The lessons learned in the development of these smaller aircraft will provide a "useful foundation" for the development of larger planes, the source said.

According to reports last month, the new company has a registered capital of 19 billion yuan ($2.7 billion), with its largest shareholder being the State-owned Assets Supervision and Administration Commission of the State Council, with 35 percent.

Other shareholders with different stakes include the Shanghai State-owned Assets Supervision and Administration Commission, AVIC I, AVIC II , Baosteel, Aluminum Corp of China and Sinochem Corp.