China's transport, tanker & heavy lift aircraft

Russian aircraft manufacturers negotiating development of Chinese wide-
body aircraft (repeat)

Moscow. May 16. INTERFAX-AVN - Russian aircraft manufacturers may take
part in developing a new Chinese wide-body passenger plane.
"Last December China adopted a large-scale civil aviation development
program. Russian aircraft manufacturers are currently discussing their
participation in fulfilling the program with their Chinese
counterparts," Director General of the Ilyushin Aircraft Company Viktor
Livanov told Interfax-AVN.
According to him, first and foremost, the negotiations are focused on
joint development and mass production of the future wide-body aircraft.
"It will most likely be the Il-86 twin-engine aircraft," he noted.
Livanov stated that the aircraft was in demand with both Chinese and
Russian air carriers. "At the present time Russian and Chinese experts
are conducting a marketing study with regards to the aircraft," he said.
According to the Chinese ADR research center, the aircraft fleet,
operated by Chinese air carriers, will be augmented by 2,232 long-range
airliners, 875 local passenger planes, and 500 air transports.

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Russia Raises Jet Export Prices for China
Russia is to review terms for a $1 billion deal to sell 38 transport aircrafts
to China. The Russian side has decided to set up production of the jets in
Russia instead of Uzbekistan and drive up the contract's price to $1.5 billion.
Russia is going to suggest reviewing terms for a $1 billion contract with China
to deliver 34 Il-76 troop-carriers and 4 jet refuellers to Beijing, a Kommersant
source reported Tuesday. The deal was signed between Rosoboronexport and the
Chinese Defense Ministry in 2005.

Director of the Russian Industry Agency Boris Aleshin has confirmed the
information, saying that all the jets are going to be produced at a plant in
Ulyanovsk. The first jet is to be sent to China in 2010, not in 2007 as was
planned. Mr. Aleshin explained that Russia decided to transfer production from
Uzbekistan to Russia as jets will be offered "in a new technical package."
Therefore, the price of the contract is subject to review, the official added.

A source of Kommersant in the military industry said on Tuesday that the Il-76
jets for China are to be equipped with the newest PS-90 engines instead of older
D-30s. The source also said that the parties would discuss increasing the
contract price by $500,000 million.

United Aircraft Building Corporation President Alexey Fyodorov said in an
interview with Kommersant that Russia and China would discuss the contract in
the nearest future.

Industry experts predict that Beijing will agree to new terms, but will bargain
better terms for other military deals with Russia.

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Totoro said:

So just which model of il-76 will be bought? M? MD? Or perhaps MF? Of course ps90 engines could be installed on any, but they come standard with the lengthened MF version... Payload would even be enough for a type99, too bad the plane is tad too narrow for such MBTs.

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China hopes problems in Russian military aircraft shipments will be
solved

BEIJING. May 17 (Interfax-China) - China hopes that problems that
have arisen in implementing a contract to supply 34 Ilyushin Il-76MD
military transport planes and four IL-78 tanker aircraft to China will
be settled based on talks between Russian and Chinese companies, a
Chinese source close to the government told Interfax.
"China has taken note of the reports concerning the Russian
position on the contract, which has aroused certain discontent in China.
We hope, however, that these problems will be settled in talks between
Russian and Chinese companies," he said.
"While dealing with this issue one should be guided by the global
political situation which necessitates stronger cooperation in this area
in the interests of both countries," the source said.
"China wants and is prepared to strengthen interaction, not weaken
or terminate it," he said.
"Certain disagreements existed in this sphere previously over
prices, the form of payment and the range of products," the source said.
"But solutions were found almost always, as a result of which
cooperation in this sector [military-technical cooperation] has been
developing successfully," he said.
A contract to supply 38 planes to China, including 34 Il-76MD and
four Il-78 aircraft, was signed in September 2005. The contract is
valued at around $1.5 billion. The first planes were to be supplied to
China in 2007 and the last ones in 2012. The contract also envisions
supplies of 152 D-30KP-2 engines for the 38 planes and over 50 spare
engines.
The Chinese side declared the contract enforced in February 2007.
But the Russian side has not done so. The first Il-76 was to be shipped
to China 16 months following the mutual confirmation of the contract.
Since the Tashkent Aircarft Amalgamation cannot implement the
contract fully, the possibility of transferring the production to
Ulyanovsk is being considered

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It seems that Russia will not reverse the plans of establishing the manufacturing of the Il-76 military transport planes in Ulyanovsk in any conditions. According to the general director of the Ilyushin aviation complex Victor Livanov the first Ulyanovsk made Il-76 will come up in 2010. It will be the plane for a specific customer. Theoretically it is possible to assume that this customer is Chinese Air Force. For long Russia has been considering the removal of the manufacturing of Il-76 from Tashkent (Uzbekistan) to Ulyanovsk. But officially the plans were announced after signing a billion contracts with China on delivering 34 transport and 4 tanker planes of this model. However, now this contract has been suspended by Russia. It is true that Russia is looking for the way of continuing the project, but its implementation under the terms agreed on in 2005 is no more possible. It will lead to huge losses as since 2005 the cost of materials and works considerably grew. Recently the head of the Federal Agency on Industry of Russia Boris Alyoshin visited Uzbekistan to participate in the session of the Russian-Uzbek intergovernmental commission. As a matter of fact all heavy military-transport planes Il-76 were made during Soviet times exclusively by the Tashkent plant. Russian enterprises did not have the capacities for assembling Il-76 at all.

The most probable outcome is changing the conditions of the contract, raising it up to 1.5 billion USD. Experts believe that finally Russia will manage to persuade China to accept higher prices, although acknowledge that this will be used by the Chinese in the future contracts. Russia also intends to introduce technical changes as a result of the upgrade and removal from the Tashkent plant. This is supposed to justify the higher price and the delivery commencement in 2010, not in 2007, as it was originally planned.

Meanwhile irrespectively of the Chinese answer Russia is arranging manufacturing of Il-76 in Ulyanovsk. The upgraded aircraft, which will meet all possible technical requirements in the foreseeable future, is needed by the Russian Air Force. Ilyushin estimates the market of Il-76 and its modifications at 150 units before 2015. Half of that accounts for the Russian Air Force. However, Ilyushin admits that it will take longer, probably up to 2025 to satisfy this demand. By 2009 the government will allocate RUB 6.4 billion for establishing serial manufacturing in Ulyanovsk. Victor Livanov called these allocations “all necessary means”. As of today Ulyanovsk based Aviastar plans to make 10 Il-76 of different modifications from 2012.
This development goes parallel to the development of another manufacturer of Ilyushin aircraft. In particular, by 2015 Voronezh based VASO intends to hire over 7000 people due to the increase of the production. Totally the plant will employ 16000-20000 staff. Recently the United Aviation-building Company approved the production program for VASO. Before 2015 it includes production of the small military-transport Il-112, long-haul Il-96 (transport and passenger), Russian-Ukrainian medium An-148, blocks for Sukhoi Super Jet - 100 and parts for Airbus. In total it is planned to make 262 planes of different types. Finally, but very importantly, VASO is likely to participate in the construction of the new generation regional plane of MS-21 from 2012. This aircraft is deemed as the core of the Russian breakthrough in the civil aviation.

According to the head of VASO Mikhail Shushpanov before 2012 the plant will make 23 Il-96. Passenger models will be built for Rossiya Airline, cargo Il-96-400T for Aeroflot Cargo and Atlant-Soyuz. Production plan includes 236 sets of units for Sper Jet -100, 74 Il-112. VASO intends to spend RUB 8.5 billion on upgrading its technologies and staff training. Partially the costs will be subsidized by the government.

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Totoro said:

If the deal does fall through, one good thing that will come out of it is even greater emphasis on domestic large airlifter programme. So, in the long run, this may turn out to be a blessing in disguise, having cornered china into only one possible course of action - put all its hopes and all its money into developing its own airlifter, sooner than it would've happened if IL76 did get fulfilled.

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Bombardier Aerospace said Monday it plans to invest about $100 million US in a
regional aircraft project with state-owned China Aviation Industry Corp.

At the Paris Air Show, the two companies said they would co-operate on
developing a 90- to 149-seat commercial aircraft.

China Aviation intends to launch its new aircraft, dubbed the ARJ21-900, in
2007, with a targeted date of entry into service in 2011, said Lin Zuo Ming, the
company's president.

"For regional airlines, the addition of the ARJ21-900 to the market offering
will complement our Bombardier CRJ family of aircraft," Bombardier Aerospace's
president and chief operating officer Pierre Beaudoin.

In conjunction with the deal, the Chinese firm plans to invest $400 million US
for research and development, construction of new facilities and equipment for
Bombardier's CSeries aircraft program, if it is launched.

Montreal-based Bombardier has said it hopes to get the CSeries ? a 100- to
149-seat jet aimed at mainline air carriers ? in service by 2013.

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