French, Russian avionics trio leap to front of RRJ 'short list'

 - August 4, 2008, 12:22 PM

AVPK Sukhoi’s ambition to use U.S.-built avionics on the Russian Regional Jet appear dashed due to an apparent lack of interest on the part of both Honeywell and Rockwell Collins. Honeywell, developer of the Primus Epic avionics software implicated in the certification delay of the Embraer 170, simply failed to respond to Sukhoi’s request for proposals, according to the Russian company. Rockwell Collins, meanwhile, has expressed a less than enthusiastic attitude toward the program after the losses it incurred with the stalled Ilyushin Il-96M/T project.

Consequently, Sukhoi has turned to France’s Thales and Sagem and Moscow-based Aviapribor to meet its schedule for a final selection by September. “The French firms have come into consideration after the Honeywell and Rockwell responses,” confirmed AVPK Sukhoi general director Mikhail Pogosyan.

Just before the Paris Air Show, Sukhoi unveiled its “short list” of project participants on major aircraft components. The list includes NPP Zvezda, a major supplier on the international space station, and Scott Aviation for the oxygen system; Russia’s Rubin Aviation, Parker Aerospace, Hamilton Sundstrand and Eaton Aerospace for the hydraulics; Liebherr, Messier-Dowty and Gidromash for the undercarriage; Moog, Thales, Curtiss Wright, St. Petersburg-based Elektropribor and Moscow-based Aviapribor for the flight controls; France’s Zodiac, the UK’s FR-HiTemp and Russia’s Tekhpribor for the fuel system; Honeywell and NPO Teploobmennik for the life-support systems; and Honeywell, Hamilton Sundstrand, KB Salyut and NPO Saturn for the auxiliary power unit.

In Paris Pogosyan issued a “conservative” prediction that the Sukhoi-designed Russian Regional Jet will draw as many as 800 sales worldwide–more than 40 percent of which would come from outside the former Soviet Union. A proposed 60- to 95-seat family of RJs developed jointly by Sukhoi, Ilyushin, Yakovlev and Boeing, the RRJ would offer a “15- to 20-percent competitive edge” over today’s Bombardier and Embraer products, he added.

Of course, acquisition cost would account for much of that claimed advantage, but Pogosyan stressed that the RRJ will derive even further efficiencies from a lower fuel burn and reduced maintenance. Boeing, meanwhile, has accepted a “major” role in helping its Russian partners create a development strategy based on a Western-style definition process. Under the direction of Boeing, Sukhoi has gathered an international airline advisory board to help decide on the final design and operating requirements, a process common among Western manufacturers but until recently alien to Russian aircraft builders.

“I don’t see any reason this project will fail,” said Pogosyan, in response to skepticism over the company’s ability to gather the resources and support network needed to satisfy an international customer base. Pogosyan stressed that the consortium has already won the financial support of state banks and a number of risk-sharing partners, including Snecma, supplier of the high-pressure core in the type’s SM146 turbofans. Snecma has partnered with Russian powerplant builder NPO Saturn, which under the terms of the deal will supply the engine’s low-pressure system components and perform final assembly.

Boeing, meanwhile, has designed the processes needed for U.S., European and Russian certification. Perhaps the U.S. company’s most important role, however, will involve its expertise in aftermarket support, according to Sergei Kravchenko, president of Boeing CIS/Russia. “We aren’t concentrating on the design of the airplane,” said Kravchenko. “We think our Russian partners bring plenty of expertise in that area. We’ve been more involved in working with the airlines.”

Under the terms of the financing scheme, 33 percent of the project’s investment will come from base capital, 21 percent from risk-sharing partners, 6 percent from state funding and 40 percent from bank loans. Pogosyan estimates the program will require $600 million in total funding and projects break-even revenue returns within seven to eight years of the first sale.

The Russian state aerospace agency, Rosaviacosmos, recently awarded the company a tender for funding, the first tranche of which it plans to disburse early next year. Sukhoi’s own funding will come from fighter sales, which totaled $12 billion in the past seven years, including license-assembly contracts. Over the next five years Sukhoi plans to deliver up to 150 aircraft worth $8 billion. With the help of the RRJ, the company expects civil aircraft production to account for between 35 and 50 percent of its total output in the next five to 10 years.

A joint assessment by Sukhoi and Boeing, based on the assumption that point-to-point traffic will develop in line with Boeing’s 2003 world market forecast, predicts an increase in the share of aircraft carrying fewer than 100 seats from roughly 7.5 percent today to some 16 percent over the next 20 years. The companies estimate the RRJ could draw some $11 billion worth of a forecast $100 billion market, estimated at 5,448 airplanes. Sukhoi hopes to generate 276 sales in Russia, 57 in other CIS states, 108 in Asia and 184 in “countries in other parts of the world.”

Next year Sukhoi and Boeing plan to form a pool of airlines committed to a consolidated order for 40 to 60 RRJs. The candidates include Aeroflot, Sibir, KrasAir, UTAir and Russia’s Finance Leasing Company (FLK). Air France and the SkyTeam alliance represent the project’s main Western prospects. The companies have scheduled first flight for early 2006, certification later that year and deliveries in 2007.

Six members of the family–three standard (60, 75 and 95 seats, respectively) and their long-range variants–require considerable engineering resources, prompting Sukhoi to seek assistance from other Russian design houses. “We have worked with Beriev to include them in the RRJ team,” said Pogosyan. “Tupolev participation is also possible.

Although Boeing has signed $1.32 billion worth of contracts with Russian concerns, including Sea Launch, the International Space Station and raw material suppliers, it has yet to invest significantly in the RRJ project. Its involvement to date has centered solely on lending marketing and certification expertise in return for some future consideration, the nature of which the company declines to identify.