Russian Airplanes Request Flight Plan into China

Russia has proposed to China that the two countries organize a joint aviation venture. Under discussion is the assembly of modernized Il-96 and Tu-204 planes. Experts in the field believe that the project has no future, because China is currently in a zone of strategic interest from international aerospace companies with whom it will be difficult for Russia to compete. They believe that it is more likely that a plan can be worked out to produce Su-80 planes in China. Russia has already basically given up on producing the planes.

Yesterday during the Zhuhai aviation fair Airshow China-2006, head of the Russian Federal Agency for Industry (Rosprom) Boris Aleshin announced plans to work together with China on the construction of passenger and transport planes. "The planes will be a wide-fuselage plane with 275 to 350 seats for passengers and a corresponding transport version of the same plane," he explained. "We are discussing a cooperative project that will be able to compete with planes from Airbus and Boeing. We would like to attract the Chinese side as much as possible in order to make it not only a financial issue but also a partnership, including the production of technology in China." In Mr. Aleshin's opinion, it is too soon to talk about volume, but the number being batted around is "in the hundreds."

Rosprom has already succeeded in introducing the project into the agenda of Russian Prime Minister Mikhail Fradkov on his visit to Beijing, which is planned for November 9-10. According to Mr. Aleshin, this program is essential to implement as quickly as possible in order to make use of the situation following delays in Airbus's A380 and A350 projects.

Ilyushin Finance Company general director (in charge of market advancement of the Russian Il-96 and Tu-204 planes) Alexander Rubtsov notes that Rosprom's project can be realized in two stages. For the first three years, it will be necessary to carry out, together with China, significant modernization of long-range Il-96 planes, midrange Tu-204 planes, and the transport versions of these planes according to the current demands of the market. It will also be necessary to create a joint-venture plane on the basis of the SC-21 (an analog of the Tu-154) plane project from the Yakovlev Aerospace Institute. Mr. Rubtsov believes that only the second stage of the project will actually involve joint development of a plane. Rosprom confirms that that is the idea that will be offered to the Chinese side during Mikhail Fradkov's visit, since that plan will allow for the joint venture's plane to enter the market against competing planes as quickly as possible.

Partnership with the Chinese, particularly with regard to the Il-96 planes, would allow the situation in the Russian aviation industry to be significantly improved. The industry is suffering from a crisis in orders (since the Il-96 was introduced in 1992, only 16 planes have been sold). Yesterday in Zhuhai, Tupolev company head Igor Shevchuk said that "Russia may count on receiving anywhere from 10% to 15% of Chinese orders for long-distance passenger planes and transport planes." According to estimates from China, the demand for such planes until 2025 will be 2232 planes.

However, independent experts believe that such estimates are premature. "Mr. Aleshin's statement is an optimistic forecast of the possibilities for cooperation between Russia and China in the sphere of civilian aviation," believes Ruslan Pukhov, the head of the Center for Strategy and Technology Analysis. "Although it is clear that, without Chinese participation, is it impossible to talk seriously about realizing the MS-21 project. Their entrance makes that project possible." Additionally, in the opinion of experts China will not orient itself exclusively towards Russian aviation. "Russia is an outsider in the sphere of civilian airplane production, so China will be more interested in working with Boeing, Airbus, or Embraer," believes Mr. Pukhov.

Experts believe that joint ventures for the production of Russian regional planes in China offer a somewhat better prospective. "Soon we can expect the company Sukhoi to sign a memorandum giving China the assembly license for up to 500 30-seat Su-80 planes for local routes (the range of an Su-80 plane is 2450 km)," said Russia/CIS Observer magazine editor Maksim Pyadushkin. "Only that variant will allow Russian regional planes to get into the Chinese market, since otherwise colossal import duties – 40% of their value – are levied for those kinds of vessels." In his opinion, the implementation of the project will be aided by the delay in the development of the Chinese regional 78-seat ARJ-21 plane: the plane's first flight has been delayed until 2008. The demand in China for regional planes seating between 20 and 90 passengers is estimated at 878 planes before 2025.