It is a competition. A competition itself includes a comparison, followed by a decision informed by the comparison. A 100m sprinting competition means that all the runners' results will be compared to each other and the shortest time is decided upon to be the winner.
SAC and CAC are in competition. Their products will be compared and then a decision will be made based on how the comparison went. The loser will then be delegated as a subcontractor and make fewer profits than the winning institute. In this way, the Chinese MIC is able to leverage human greed as an incentive while preventing said greed from running amok and compounding to ridiculous levels as it does with Western private arms manufacturers. At least that's how it works for domestic procurement, foreign military sales are fair game for as much greed as the manufacturers want.
In your mind and context it may well be, but my point is that losing the "competition" will NOT cause Shenyang or Chengdu to cease to exist, while on American soil there are the "memories" of many, many, many successful competitors, who because of a bad business decision or lack of innovation are "out of business"..
My real point is that the J-20 and the FC-31 will NOT engage in a "fly-off", due to their distinctly different classifications even though they are each one fifth generation designs...
but call it what you will?? it seems that each has their niche, the J-20A is a land based long range A2A platform, the FC-31 is of a similar size that both the Russians and Indians now operate off the ramp on the carrier..
of course the CAT will change the dynamic, but not in the immediate future??
the J-20 is now a mature design in current production and inducted into PLA service, I rather doubt that there is production capacity to meet the needs of both the PLA and PLANAF???