Nikitkin of MAPO confirms committment to Tu-334 and its role in company's future

Published: 11/15/1999

Nikolai Nikitin, General Director and General Designer of VPK MAPO, has confirmed the company's commitment to the Tu-334 project. This follows the company's announcement, in September, that it intended to diversify into civilian production (www.concise.org. 8th September and 12th October 1999). An October governmental decree authorised MAPO to spearhead the project, so giving Russia's newest passenger aircraft a new lease of life and enabling MAPO to use more of its vast production capacity, of which a mere 7% is currently utilised. With a major drop in state orders in recent years and fierce competition on the export market from both domestic and foreign fighter jet manufacturers, MAPO was faced with substantial redundancies, following the restructuring programme it began in 1996. Only 20% of its 13,000 staff is now involved in MAPO's fighter jet programmes. According to Nikitin, MAPO is confident that demand is strong for new-generation 100-seat jetliners. The Tu-334, which was conceived ten years ago, has stalled for lack of funding. Financing for the Tu-334 will come mainly from MAPO's earnings in foreign fighter upgrade deals. Nikitin claims that some funding will also come from debt financing, although he would not elaborate on this. He estimates that $69m will needed to gain certification and set up production. Nikitkin is hopeful of some state participation, but acknowledges that this is likely to be limited. For the project to break-even, $309m of sales will be needed, based on the sale of 67 airframes within 90 months of the start of production. Igor Kalygin, Chief Designer of the Tu-334 at Tupolev, said that the Tu-334 should get certification in 2001, for which it should perform 800 test flights. The first delivery is planned for 2002. Final assembly will be at MAPO's factory in Lukhovitsy, near Moscow, using parts manufactured by the Znamya Truda (Banner of Labour) and Aviant factories located in Moscow and Kiev. Nikitin claims that Russian interest extends to some 250 aircraft. Foreign clients are expected to buy 100 airframes. Earlier estimates predicted a total market demand of 1,000 until 2010. Negotiations with Iran on license production are continuing, but Nikitin has refused to reveal any details until the deal is finalised. However, Vasily Alexandrov, General Director of Tupolev, said recently that technical problems have now been resolved, although funding difficulties are still outstanding. He added that a Russian delegation would go to Iran shortly to conduct all necessary training, suggesting that an agreement is imminent. (www.concise.org. 19th October 1999). While seven versions of the Tu-334 have been drawn up, resources will - more realistically - now be concentrated on the basic version, the Tu-334-100, with 102 seats and two 16,535lb st Ukrainian ZMKB Progress D-436TI engines. MAPO does not consider that a “westernised” version will be required, so long as there is adequate after-sales support for the aircraft outside of Russian and the CIS. This level of support will have to be demonstrated by the producers, as few would currently credit then as having such a network According to Nikitin, Aeroflot and Transaero have already expressed interest in the aircraft. For Russian carriers, the Tu-334 will be available on lease terms, via a state-supported aircraft leasing system, whose foundation is now being discussed at government level (www.concise.org 26th October 1999). The target price for the Tu-334 remains at $15m, as previously reported. This is significantly less than the Boeing 717 ($30m) and Airbus A318 ($33-35m). Nikitin is optimistic that the Tu-334 will be ready before the A318. During the Dubai aerospace exhibition in November, a Tu-334 made a successful demonstration flight, in spite of the 40 degrees centigrade heat, having made its first foreign flight to Dubai for the performance. It is encouraging to see the Tu-334 programme developing so aggressively, however, even the most casual of observers may suggest that the enthusiasm for large numbers of sales is somewhat predicated on a series of events that are by no means certain. The main uncertainty being the emergence of a government sponsored leasing scheme, which has struggled to establish itself for the last three years, and still remains subject to the vagaries of a volatile Russian political scene. Salvation may come, were three previous PMs have failed, from the increasing influence of the military with current Prime Minister Putin and their clearly stated desire to see more funding for the aerospace industry. In the Russian psyche historically, the aerospace industry is a potent sign of national self worth, something that will not be lost on PM Putin as he announces his candidacy for the presidential elections next year.

Article ID: 1076