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Economy 14/05/2007 Russia not to profit on Il-76 deliveries to China

Russia has faced difficulties while implementing the contract for delivering Il-76 aircraft to China, Kommersant reported quoting Gazeta on Monday.

Sticking to the prices of 2005 agreement will result in material losses for Russia, said Ilyushin Aviation Complex General Director Viktor Livanov. So, the contract has been suspended and today’s concern is to find ways to execute it without hefty financial losses.

The difficulties related to the contract’s implementation will be the highlight of negotiations that Boris Aleshin, chief of Federal Agency for Industry, will hold in Uzbekistan.

The thing is that the subcontractor is Uzbek Tashkent Aviation and Production Association. This enterprise used to make such aircraft in time of the former Soviet Union and Russia lacks the respective facilities.

According to analysts, Russia is willing to construct an Il-76 production line in one of its enterprises and may suggest amending the contract to partners in China, prodding them to share the costs for launching the line. The estimated amount is between $80 million and $100 million.

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