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Russia Eyes New Aviation Glory With Superjet

Saturday 23/09/2017 - Source: MSN Money

Russia will seek a boost for President Vladimir Putin's bid to revive its once mighty aviation industry this week, by rolling out its first modern commercial airliner for the global market -- the Superjet.

Built by the former Soviet Union's largest warplane maker Sukhoi, whose Su-27 fighter family was designed for combat with Boeing's F-15 Eagle, the civil Superjet is a 78 to 98 seat regional airliner developed in co-operation with its old Cold War foe.

The new civil plane will be unveiled at a Sukhoi military factory at Komsomolsk-on-Amur in Russia's Far East on September 26. Its September maiden flight has been delayed for a month or two.

While Boeing's involvement in development is seen by analysts as a symbolic one, with the U.S. group keen to tap into Russian titanium supplies for its next generation of jetliners, French and Italian firms have invested heavily in the project.

At stake is an $8 billion market for regional jets dominated by Brazil's Embraer and Bombardier of Canada, though that is relatively small compared with the $60 billion spent annually on big jets made by Boeing and Airbus.

Sukhoi's new civil battle also pitches it against Chinese and Japanese firms racing to invest in regional jet transport -- a market which offers a chance to flex industrial muscle without the colossal sums needed to challenge Airbus or Boeing.

"This is a very important program for Russia because it means the rebirth of its aerospace industry," said Marc Ventre, executive vice-president of aerospace propulsion at French conglomerate Safran .

"The Russians are very good in military aircraft but in commercial aircraft they are far behind, and this should put the their industry back on track," Ventre told Reuters.

Russian aviation collapsed after the fall of the Soviet Union. Observers say Putin wants to breathe new life into the sector to demonstrate Moscow's industrial clout abroad and help project the Kremlin's authority to voters inside Russia.

Russia's leader has forged a giant new state aircraft holding company, known as United Aviation Corporation, to spearhead the revival under First Deputy Prime Minister Sergei Ivanov, a Putin favorite tipped as leading candidate to succeed him next year.


Key to the Superjet's success is a deal between Sukhoi and Italian aerospace firm Finmeccanica , whose Alenia Aeronautica unit has 25 percent of Sukhoi's civil division.

Alenia, which co-owns Franco-Italian turboprop maker ATR with Airbus parent EADS, plans to provide after-sales service and support that are both crucial for winning contracts.

Sukhoi hopes to reach 100 plane sales by end-year. Safran's Ventre predicted at least 800 sales in total, worth $20 billion.

Russian airlines Aeroflot and Air Union are the main buyers to date of the Superjet 100.

ItAli, an airline based in the Italian town of Pescara, was the first Western firm to order the jet. Air France and Lufthansa are on the target list for sales, but the only other foreign customer so far is Armenian airline Armavia.

Sukhoi hopes to charm airlines with a relatively low list price reported to be $25 million, about 25 percent below rivals.

Safran's Snecma unit is co-operating with Russia's NPO Saturn to produce the engines for the Superjet 100. French electronics firm Thales is fitting the avionics.

Analysts say outside investment is vital for shrugging off the second-best image that tainted previous efforts to build commercial jets with Western engines by Ilyushin and Tupolev.

But there are doubts over the relatively narrow corner of the global market targeted by Russia, with China and Japan not far behind. Embraer is firmly in the driving seat, followed by Bombardier, and some question whether there is room for more.

"What was a growth market is now a flat market. Aviation is booming but regional jets are the flattest market of all," said Richard Aboulafia of U.S.-based aviation consultancy Teal Group.

With relentless pressure on seat-mile costs, airlines will also look hard at performance once the Superjet starts flying.

The Sukhoi Su-27 "Flanker" is famous for its breathtaking "Cobra" maneuver at air shows. But hard-nosed airlines are only concerned about characteristics such as weight and a couple of extra tonnes can be a death sentence to a civil aircraft project.

"Military people tend to over-engineer," Aboulafia warned.

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