In the next ten years, Russia will continue to specialize in military planes. The fundamental reason for this is clear. The Soviet Union invested the heaviest in the defense industry for two or three generations, and the success of Russian companies on the global market in the post-Soviet era is the result of that Soviet investment.
In the sixteen years from the collapse of the Soviet Union till 2008, the Russian aircraft industry sustained a fairly good pace of combat aircraft production (first and foremost, the heavy fighters Su-27 and Su-30). However, orders came almost exclusively from foreign countries; the Russian Defense Ministry did not make any purchases. Simultaneously, manufacturing of passenger and military transport aircraft fell almost to zero, and Russia essentially dropped out of the market for military and civilian transport planes.
The current situation, which has taken shape since 2008, is characterized by the following features:
First, production of tactical fighters for export continues at a high pace. There has been a decline compared to the previous decade due to the saturation of the Chinese and, to some extent, Indian markets, but production still remains fairly high. Russia lags behind only the United States in this sphere and comes out ahead of European manufacturers of combat planes. In 2009-2011, Sukhoi and MiG signed foreign contracts for over 90 fighters. The main buyers are India (29 MiG-29K), Vietnam (20 Su-30MK2), Myanmar (20 MiG-29 in various modifications), Algeria (16 Su-30MKI (A)) and Uganda (6 Su-30MK2).
Second, there has been a fundamental shift in the procurement of new combat aircraft by the Russian Defense Ministry. Since December 2008, the Russian Air Force has bought a total of 130 tactical airplanes. The biggest contracts were for 32 Su-34 tactical bombers, 48 of the new Su-35S fighters, 16 Su-27SM3 and Su-30M2, and 34 MiG-29SMT. The new State Armaments Program, approved in late 2010, calls for the purchase of 600 combat and military transport aircraft. If the Russian economy and energy prices can support the necessary financing, the average annual supply of combat aircraft to the Russian Air Force will exceed the procurement levels of European countries like France and Germany. Given the ambitious production plans for military transport planes, there is even a chance that the Russian aircraft industry will not be able to boost production fast enough to meet these tight deadlines.
Third, research and development for promising projects in both commercial and military aviation have really taken off. The biggest achievements have been the start of flight tests of the fifth generation T-50 fighter, the start of commercial service of the regional aircraft Sukhoi Superjet-100, and the dramatic acceleration of work on the medium-range MS-21 airliner. These achievements warrant cautious optimism about Russia’s prospects on the combat aircraft market and even more cautious hope that it will enter the commercial aircraft market.
The more or less guaranteed orders from the Defense Ministry represent a significant leap forward for the industry. But the main structural problem of the Russian aircraft industry – its absence on the commercial aircraft market – persists. The progress on the SSJ-100 and MS-21 projects has not changed the situation in this sector and cannot change the situation for the time being, as even the older of the two programs – Sukhoi’s – is in the very early stage of introducing the plane in commercial service and starting serial production. Besides, while the market for regional jets – to which the SSJ-100 belongs – is growing fast, it is still far smaller than the market for medium-range and long-haul planes. This means that in the next decade Russia will, at best, be able to reach the second tier of manufacturers, already represented by Brazil’s Embraer and Canada’s Bombardier and very likely to be joined by China in the near future. This is, I’d like to emphasize, the most optimistic scenario, and therefore not the most probable. Russia is more likely to reclaim its leading position in military transport aviation. A lot will depend on the dynamics of Russian-Ukrainian cooperation. But even if it proves difficult to come to terms with the Antonov company – which is often the case with attempts to build civilized relations with Ukrainians – and the An-70 and An-124 projects tied to Kiev do not go through, the program to build the Il-476 military transport plane alone will act as a powerful driver of the industry.
So it can be said with certainty that, in the next ten years, Russia will continue to specialize in military planes. The fundamental reason for this is clear. The Soviet Union invested the heaviest in the defense industry for two or three generations, and the success of Russian companies on the global market in the post-Soviet era is the result of that Soviet investment. However, there was no commercial aircraft production as such in the Soviet Union. It did manufacture civilian passenger planes, but there was no commercial production. The country is now facing the challenge not of reclaiming a past position but, for the first time in its history, acquiring competence in designing, building and marketing competitive commercial airliners. This will require at least ten years and tens of billions of dollars in investment. The militarist Soviet past continues to shape the Russian aircraft industry, and only the engineers, designers, workers and managers that are now graduating from universities and vocational schools will be able to overcome this legacy.
