Aerospace Opportunities

An Expert's View about Civil Aircraft in Russia

Last updated: 19 Jul 2011

Aerospace is one of the Russia's highest value adding manufacturing sectors, with between 275 and 300 aerospace companies, including 108industrial producers, and 111 R&D and design bureaus.

Sector briefing Aerospace Opportunities in Russia Why Russia? Aerospace is one of the Russia's highest value adding manufacturing sectors, with between 275 and 300 aerospace companies, including 108 industrial producers, and 111 R&D and design bureaus. The Russian aerospace industry is one of several key business sectors kept under constant review and scrutiny by the Russian Government. 5 000 bln roubles (106 bln GBP) (10 times more than in the last decade) will be allocated from the federal budget for the aviation sector up to 2020; 470 bln roubles are allocated from the Federal budget to be spent on civil airport modernization and the upgrade of the general air traffic system; 11 bln roubles are allocated for transport safety ?106 bln GBP will be allocated systems upgrade and development from the federal budget for aviation sector up to 2020 ? Find general information on the Russian market conditions on UKTI?s website. The Doing Business Guide for Russia gives an overview of Russia?s economy, business culture, potential opportunities and an introduction to other relevant issues. UK Trade & Investment Sector briefing: Aerospace opportunities in Russia ? Air traffic control (on ground and in the Opportunities air); free flight technology are The global aerospace industry has been developing and seek support; focused on Russia due to the huge growth ? Re-engineering, virtual production potential in the Russian market as ? Scientific cooperation, UTCs, creating an manufacturers replace and upgrade equipment international laboratory are enlisted as and look for modern materials, components, major goals. and technologies for their products. Advanced Composites Key government organisations Composite materials including power composite representing 80% of the Russian machines are in the focus of Russian Aerospace Aerospace: industry representatives? attention. New United Aircraft Corporation (UAC), GBP 3.5 projects emerging in the Russian Aerospace * bln . A holding consisting of the leading sector envisage the use of advanced composite Russian aircraft design and manufacturing materials. UAC has announced a new $100m companies, focused on the country's aircraft JV to manufacture composite wing components output and improving efficiency. in the city of Kazan, Tatarstan. At the inception United Engine-building Corporation, GBP 1.5 phase, the JV would import raw materials for ** bln UEC consolidates over 80% assets in composite components. Russia?s engine-building sector. Was established as Oboronprom?s affiliate to control ?Aerocomposite?Ltd., created by UAC, deals design and manufacturing of series production with design, testing, manufacturing and of engines for aerospace, energetic and realisation of composite parts, aggregates and transport. components of civil aircraft. It is currently Rostekhnologii was established to promote cooperating with British companies e.g. the development, production and export of ?Instron?, ?SciTech? and is eager to find new high-tech industrial products. One of its partners. aviation assets is Helicopters of Russia * Holding, GBP 1.4 bln . The managing body of Sukhoi, one of Russia?s premier aircraft the consolidated Russian helicopter industry, designers, is already designing, producing and incorporates 14 helicopter companies, setting testing parts and units built from polymer and new standards of competitiveness, efficiency, composite materials. The new production line technology, and profitability. will be set up at Kazan?s Gorbunov KAPO aircraft-building factory. Initial production, Cooperation with the UK scheduled to begin in the Q1 of 2013, will be Memorandum of Understanding was signed at for Sukhoi?s commercial airliner, the SuperJet the Farnborough International Airshow 2010 100, and Sukhoi?s MS-21 aircraft where between the United Aircraft Corporation and composite components will account for at least A|D|S UK. The Russian Association of Aircraft 30-40%. Engine Manufacturers also signed a similar MoU with A|D|S. Aerospace is likely to be a NB: Russian industry representatives will also particularly fruitful sector for collaboration, participate in International Composite with Russia set to develop Europe?s largest Exchange Programme in March 2011, UK. aerospace market by 2013. Aircraft Projects OPPORTUNITY AREAS IN TRADE A number of indigenous aircraft programmes are underway or being planned that present ? Russian aerospace industry is now opportunities for companies with contract focused on new sources of energy for research and/or consultancy capabilities - SSJ aviation (chemical energy generators) 100; MS-21; Tu-204 SM. and alternative fuel; ? SSJ-100 ? Flight safety (global system of aircraft A medium-haul passenger aircraft. Production monitoring) is of primary concern and a version first flight was made in November subject for conferences and round 2010. tables. On 21 April 2011, Sukhoi Superjet 100 performed its first commercial flight in ?Armavia? fleet. During the past month the aircraft has made * Revenue in 2010 66 flights in total. ** Revenue in 2008 available only UK Trade & Investment Sector briefing: Aerospace opportunities in Russia ? MS-21 A twin-engine medium-range single aisle Ulyanovsk Special Economic Port Zone passenger jetliner. The initial design is to Creation of Special Economic Port Zone (SEPZ) include 33% of composite materials, can be of interest for companies who wish to increasing to 40-45% provided a composite manufacture close to their client or localize in wing is added in 2015. The project is supported Russia. The Ulyanovsk region ranks 1st in by numerous international and particularly Russia in civil aircraft manufacturing. Investor British suppliers and the certification of the support and international cooperation is aircraft is planned for 2016, so new welcomed now for the new project-creation of international partners could be engaged. SEPZ. Benefits for residents: ? ? Exemption from customs duties, VAT Tu 204SM and excise taxes; property tax for 5 An enhanced reduced-weight version of the Tu- years; land tax for 5 years 204-100, with improved systems. Around 18% ? VAT refund for goods/equipment placed of the current production Tu-204 is composite in SEPZ by structural weight, and this will increase to ? Profit tax rate reduction to 15.5% 22-25% on the revised design. Deliveries are scheduled to start in 2011. RUSSIAN AVIATION UNION For now Tupolev is ready to cooperate with new partners and suppliers of equipment to Russian Aviation Union is an industry assembly and service centers. association, which represents corporate H interest of the Russian aerospace industry at elicopters all levels of executive and legislative branches Russian Helicopter industry is now focused on as well as in various international light weight helicopters, as the Russian he organizations. UAC and Russian Helicopters are licopter fleet abandons heavy vehicles and part of the Union too. lacks the light ones. R The Aviation Union has 5 functional proactive ussian Helicopters is the leading Russian commitees: full-cycle designer and manufacturer of he - International relationships licopters for civilian and defence markets. The - Standartization holding actively works with international - Flight suppliers and seeks new partners in the - Supply chain control following areas: - Scientific research, R&D Russian Aviation Union deals with all major - Safety, medical, search and rescue and Aerospace events and in focused on fire protection equipment for helicopters cooperation with international partenrs. UKTI - Avionics have a working relationship with the Union. - Navigation and connection systems - Flight safety If you have any questions on the opportunities - External equipment above, contact the UKTI contacts named in this - Helicopter market analysis and report. Business opportunities aimed specialized Mass Media specifically at UK companies are added daily to - Helicopter building theory UKTI?s website. These leads are sourced by our staff overseas in British Embassies, High Russian Helicopters have a number of projects Commissions and Consulates, across all sectors like ?i-171?, ??-32?11BC, ??-62, ?i-38, ?i- and in over 100 markets. 26?2, Ansat, ??-226?, ?i-34?1 which are in p rogress now as well as new-generation Mi-38 u You can be alerted to business opportunities on tility transport helicopters, production to start a regular basis by registering on the UKTI in 2013. The Mil plant in Moscow is planning to website. Find out more on UKTI?s business show the second prototype to potential start opportunities service on the UKTI website. batch production at the Kazan Helicopter Plant in 2013. UK Trade & Investment Sector briefing: Aerospace opportunities in Russia Major events and activities UKTI contacts MAKS-2011 Elena Pashina Trade & Investment Adviser Time: August 16-21, 2011 British Embassy Moscow Tel: +7 495 956 7229 Major Russian Aerospace companies are Email: always represented at international airshows: Olga Makarchuk Farnborough (UK) Team Leader British Consulate General Time: 2012 St.Petersburg Tel: +7 812 320 3223 Find full details of all events in this Email: country and sector on the UKTI website. New export events are added daily to the site and you can register to be alerted to them on a daily, weekly or monthly basis UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Aerospace opportunities in Russia Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organise seminars or other events for business in the Russian market are advised to you to meet contacts and promote your undertake as much market research and company in the Russian market planning as possible in the UK. UKTI?s team in Russia, with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in global markets. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Russian market to find contact details for your local UKTI ? Establishment of interest of such office. contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © You may reuse this information (not including logos, images and case studies) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit licence/ or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: This publication is also available from our website at or for more information please telephone +44 (0)20 7215 8000. UK Trade & Investment Sector briefing: Aerospace opportunities in Russia
Posted: 19 July 2011, last updated 19 July 2011

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