Recently, the United Aircraft
Corporation UAC of Russia has been
actively campaigning for the
localization of civil aircraft assembly
abroad. In a recent interview, Vadim
Badeha, the CEO of UAC, underscored that
the company is in the process of
negotiating with several countries to
establish joint production projects.
These projects would enable the assembly
of Russian airliners at foreign
locations.
It is crucial to note that this
negotiation is not about the direct
delivery of completed aircraft. Rather,
it is about the establishment of joint
ventures which presents new
opportunities for long-term
collaboration and market expansion.
In addition to traditional partners from
the CIS countries, negotiations are
being conducted with a much broader
spectrum of states. As Bada observed, he
proposed the establishment of an
assembly facility for the MC21 medium
hall airliner in Latin American
countries as an illustration.
Localizing production is becoming a
global trend in both civil and military
technical aviation for significant
countries. According to him, this method
not only enhances the appeal of Russian
aircraft to foreign consumers, but also
broadens their global market presence.
The corporation has already achieved
favorable results through its
collaboration with India which is a
focus of UAC's attention. The Russian
side is prepared to provide Indian
partners with the polished product as
well as the transfer of engineering and
production competencies which will
enable India to develop its own aviation
industry. UAC proposed the possibility
of localizing the production of the
SSJ100 aircraft in India in 2023 and
also extended an offer of collaboration
on the IS114 and MC21 programs.
Hindustan Aeronautics Limited, a company
with extensive experience in the
production of both military and civil
aircraft is currently in the process of
negotiating.
India has made an active effort to
secure the manufacturing of aircraft in
the country from Boeing and Airbus. The
two countries have not outright rejected
assembling aircraft in India. However,
they have indicated that the current
volume of orders from Indian airlines is
insufficient to justify the
establishment of a final assembly line
for commercial aircraft in the country.
Boeing has explicitly stated that it
would not consider establishing a final
assembly line in India until a
significantly higher volume of aircraft
orders is received. Despite the Indian
government's strong advocacy and ongoing
discussions, Boeing's leadership has
underscored that despite India's swiftly
expanding aviation market, the business
case for local assembly necessitates a
scale that exceeds current demand.
In the same vein, there is no public
evidence that Airbus has made a
commitment to establishing a full-scale
commercial aircraft assembly line in
India. Boeing and Airbus are both
maintaining solid supply chain and
component manufacturing partnerships in
India and continue to monitor the
market.
In contrast to the majority of Western
competitors, the Russian company is
prepared to provide aircraft, exchange
technology, participate in joint
development, and train specialists. This
method fosters a more profound level of
collaboration and aids in the
advancement of the national aviation
industries of its partners. Bada
underscored that UAC is prepared to
collaborate in a manner that facilitates
the technological independence and
expansion of Indian aviation.
The company and Russian aircraft
manufacturers both benefit from the
decision to localize production abroad.
It enables the expansion of the market,
the establishment of long-term
alliances, and the reinforcement of
Russia's position in the global aviation
market. Nevertheless, Bedha observed
that a successful export strategy is
contingent upon a well-developed after
sales service system. The SSJ100's
export mistakes when the service
infrastructure was unprepared for new
aircraft should not recur.
The MC21 could be rendered more
competitive in international markets by
enabling Russia's United Aircraft
Corporation, UAC, to circumvent import
restrictions or tariffs through local
assembly. Several countries in Latin
America are seeking to modernize their
fleets as the aviation market in the
region is expanding.
Local production may be of interest to
governments and airlines that are
interested in industrial cooperation and
job creation.
Establishing a production center in
Latin America could potentially
diversify UAC's customer base and reduce
dependence on domestic or CIS sales as
Western sanctions have restricted
Russia's access to traditional markets.
Additionally, the successful operation
of these aircraft within Russia is
directly correlated with the attraction
of foreign customers.
Increased interest from foreign clients
is contingent upon the domestic aviation
sector's demonstration of the
reliability and efficacy of new models.
In general, UAC regards localization as
a critical instrument for improving
competitiveness, particularly in light
of Russia's efforts to develop aircraft
that are entirely import independent,
such as the SJ100 and MC21.
Therefore, the decision to relocate the
assembly of Russian aircraft abroad is
not solely a commercial strategy. It is
also a political and technological one.
Its objective is to fortify the Russian
aviation industry's global market
position by forging sustainable
partnerships and transferring critical
competencies to international partners.
Now, do you think Latin America and
India have enough aircraft volumes for
local production? Let us know in the
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