Prospects improve, but pessimism still prevails (690 words)

Published: 6/6/2001

The An-70 has made its first flight since crashing in January, following repairs and ground tests at Polyot in Omsk. Later this week, the aircraft will be exhibited at VTTB-Omsk-2001, after which it will continue its test flight programme in Kiev, Yakutia (cold temperature tests), Archangel region (icing), and in the UAE or Libya (hot temperature tests). The Russian Aerospace Agency (RAKA) has also prepared terms for a tender for the serial production of the An-70 and its modifications in Russia. According to Leonid Terentyev, General Director of STS, the consortium responsible for the aircraft, invitations to participate in the tender will be sent to nine Russian aircraft-building plants. Originally, serial production was to be at Aviant in Kiev and Aviakor in Samara, but the change to a tender seems largely attributable to Aviakor's inability or unwillingness on the part of its controlling shareholder, Siberian Aluminium, to provide funding for serial production in the absence of substantial orders. However, according to reports, the original order for Aviakor to start production in 2000, which was issued in December 1999, has not been cancelled. Vladimir Belogub, General Director of Aviakor-Aviation Plant, claims that the plant is ready to work on the An-70 programme, but it seems unlikely that the company could raise the estimated $120m required for production of three An-70s, from 2002 through 2005, under the current plan. Belogub points out that there have been frequent changes to the various plans and timetables for the An-70's development and production. He does, however, admit that, given the current condition of the plant, it could not undertake assembly before late 2003. There are also reports of heavy lobbying by Aviastar for the production line to be established at Ulyanovsk , given that the plant is currently producing aircraft, although the claim of commonality with the An-124, which is also produced at the plant, appears more spurious. Belogub says that, from the Russian perspective, the problem for Aviakor and the programme remains funding from the Russian state and confirmation of orders. He nevertheless believes that, once the programme is underway, the prospects will improve, both for the military and the proposed two-engined commercial version of the aircraft. According to Terentyev, the Russian state has so far allocated a little over $1m for the An-70 current development: a quarter of the sum allocated by Ukraine, although undisclosed additional funds are available from the Russian Air Force. No funds from the Russian state have so far been announced for serial production in 2001, although the commitment by the Ukrainian Ministry of Industry of $2.5m appears inadequate under the agreement signed in April 2001 with the Ukrainian MoD for the production of five An-70, with deliveries starting in 2002. Recent reports have, however, suggested that the deal for the Ukrainian aircraft was also concluded at a substantially discounted price of $40m, after considerable pressure was applied by the Ukrainian MoD. If the Russian state appears reluctant to commit funding to the aircraft, this may in part be due to the failure of the programme to attract the external funding, tentatively dangled in front of the STS consortium, in the proposal for the adoption of the aircraft by the German Air Force. There are also reports that the Russian Air Force, while it remains enthusiastic about the An-70, believes that the aircraft is expensive and offers only small advantages over the re-engined Il-76. The Il-76MF has lately figured heavily in the air force's plans, with Victor Denisov, commander of the 61st Air Army, commenting that the An-70 could make up 30-40% of the total Russian cargo military aviation, along with the An-124-100 and the Il-76MF with the PS-90A engine. This suggests a substantial diminution of the 500 aircraft requirement previously discussed before 1999 and the 165 aircraft since that time. The producers of the aircraft's engines also seem pessimistic, having stopped producing the D-27 for the present, with 20 engines either completed or in progress. One member of the engine consortium, UMPO, based in Ufa even withdrew on the grounds that prospects elsewhere offered better returns.

Article ID: 2574