When installing the SPFx add-in in a subsite, web parts can be added to pages in that site.
When installing the SPFx add-in in a subsite, web parts are not provisioned to the web part gallery and it's not possible to add web parts to pages. This has to do with the fact that the feature provisioning .webpart files is web-scoped while the web part gallery exists only on the root web of the site collection. As a result the _catalogs/wp URL points to a URL that doesn't exists in the subsite.
In the next drop or so, we are changing this behavior to load the web parts from the tenant catalog just like it happens in modern pages. That should resolve this issue.
Thanks!
Does that mean that it would be no longer necessary to install the SPFx add-in in the site?
If you have items to provision, such as list or library, along with your web part, then you will have to install the SPFx solution in the site. If not, you don't.
@waldekmastykarz @chakkaradeep : a couple of questions.
1) I assume when you say "create a site/sub-site" you mean in the O365 developer account, right?
2) in the segment
in the subsite add the SPFx add-in
edit the page to add the web parts from the SPFx add-in
web parts are not included in the list of available web parts
check the web part gallery in the site collection
web parts from the SPFx package are not present in the gallery
how do you add the web parts from the SPFx add-in?
for example: I've created the hello-world-sp example from the tutorials, have built it and run the gulp serve and the webpart works as expected on the localhost:4321/workbench.html.
so my question here is how do I load this helloWorld webpart into my office 365 site.
or at least can you point me to the docs where I can read and learn the process?

Thanks for your help.
@dcu-sharepoint here is more information about how you can deploy SPFx web parts to SharePoint: https://dev.office.com/sharepoint/docs/spfx/web-parts/get-started/serve-your-web-part-in-a-sharepoint-page
@Waldek
that's exactly what I was looking for. I had posted on a forum and was sent to another forum and then to stackoverflow where the question just died about a week ago....
now I can get going. thanks again. may the gods of wealth keep healthy rich and famous.... [😳]
From: Waldek Mastykarz notifications@github.com
Sent: Wednesday, January 11, 2017 1:45 AM
To: SharePoint/sp-dev-docs
Cc: L. Carlos Rodriguez; Mention
Subject: Re: [SharePoint/sp-dev-docs] Web parts not installed when adding the SPFx add-in in a subsite (#304)
@dcu-sharepointhttps://github.com/dcu-sharepoint here is more information about how you can deploy SPFx web parts to SharePoint: https://dev.office.com/sharepoint/docs/spfx/web-parts/get-started/serve-your-web-part-in-a-sharepoint-page
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Web parts on classic pages don't use .webpart files anymore, so this issue is non-existent with the new architecture. Closing it.
If you want to install spfx web parts for on-prem too please take a look at my blog post -> https://rasper87.wordpress.com/2018/04/26/provision-spfx-web-parts-to-classic-sites-part-3-install-spfx-web-part-to-sharepoint-site-web/
Issues that have been closed & had no follow-up activity for at least 7 days are automatically locked. Please refer to our wiki for more details, including how to remediate this action if you feel this was done prematurely or in error: Issue List: Our approach to locked issues
Most helpful comment
If you have items to provision, such as list or library, along with your web part, then you will have to install the SPFx solution in the site. If not, you don't.