Ukraine as a successful player on the aircraft market

Author : Olena Holubeva

Respondent : Oleg Orlov

Source : 112 Ukraine

Antonov Airlines' new US base in Houston has transported an outsized communications satellite for Orbital ATK
23:12, 1 February 2018

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Antonov Airlines, air transport department of Ukraine’s state enterprise Antonov, announced about the opening of an office in the United States. Antonov Airlines' new US base in Houston has transported an outsized communications satellite for Orbital ATK. We have contacted Oleg Orlov, vice-president of Antonov, and he said about how the company broke off a ten-year partnership with the Russians. Now they have taken the path of tough competition for each flight.

Please tell us about the opening of the office in the United States.

The US office was opened in December last year by Antonov Airlines general sales agent, Dreamlifts, which invested in the opening of the US office. Dreamlifts is based in Stansted, a suburb of London (UK). Its team employs 23 English specialists who have extensive experience in organizing air transportation. Some of them have been cooperating with our company for 20 years or more, including representing the interests of Antonov Airlines in a joint venture with Ruslan International, established in 2006 together with Volga-Dnepr Airlines. At the end of 2016, it was decided to terminate cooperation with the Russian partner.

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Who invested in the creation of an office in Houston, Antonov or Dreamlifts?

Dreamlifts, but we work in close contact in this area, as well as in other ones.

In the US market, you are competing with Russian Volga-Dnepr?

We compete with them on the world market, not only in the USA. We had a number of advantages, so last year, we achieved certain successes. In short, we have made 2017 the year of Ukraine, that is, we represented Ukrainian company Antonov Airlines under the Ukrainian flag, with Ukrainian symbols at all the specialized exhibitions and conferences that took place in the world, so that everyone would understand that we are Ukrainians. For 10 years of Ruslan International existence, people did not realize that Antonov is a Ukrainian company.

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Did the financial performance of the Antonov transport business improve after the break with Volga-Dnepr?

Yes. Revenue grew by 15-20%, while the cost per hour of the flight decreased. We are now raising profitability by increasing the raid.

American aviation industry is developed sufficiently. Why are the services of Ukrainian and Russian cargo carriers in demand?

Ruslan has no competitors in its segment. The appearance of this aircraft has formed the market for heavy and outsized cargo air transportation. Another advantage of An-124-100 is the possibility to base on a wide network of airfields.

Related: “Antonov” may receive British equipment for its aircraft under import substitution

Do Americans have no analogs of Ruslan or Mriya?

There are some analogs, but Ruslan goes beyond them, and Mriya is simply unique! Mriya is like a visiting card not only for our company but for Ukraine as well. Wherever we go, everyone knows about Mriya. This aircraft has repeatedly participated in humanitarian missions, delivered cargo to zones of natural disasters; several times it was used in peacekeeping operations. There is no aircraft like Mriya. It was conceived as a flying cosmodrome. Mriya first raised in the sky back in 1988. There is no analogy to it in the world, and I think that it will not appear soon. As for Mriya’s cargo transportation, we already have orders for March and April. The London office is working with them.

Are Ukrainian pilots the helm of Ruslan and Mriya?

We have our own flying squad, which is based on Antonov test pilots, navigators, radio operators, flight engineers, and highly professional technical staff.

Related: State enterprise Antonov commented on its possible cooperation with Russia

What are the competitive advantages of Antonov Airlines before Volga-Dnepr?

The most important advantage is that we are working in close connection with the developer of our aircraft, the state enterprise Antonov. Our airline has the status of air transport division of the enterprise. All the necessary works for the improvement are carried out on the aircraft of our park. After all, international requirements are constantly tightened, and they need to comply with the requirements to be able to fly around the world. We have a clear program for upgrading Ruslan during the next 5 years.

Do you compete with Russians on transportation tariffs?

Yes. A lot of things depend on the cost of an hour of flight.

What additional opportunities the does company receive after the opening of its office in each country?

Well, I can judge from my own experience, every country has its own mentality. You should know how to work with the foreign partners. When participating in the negotiations, I felt the difference in the approach of the British, Americans, Ukrainians... For example, I live in America; for me, it is easier to work with customers in the United States. They speak the same language, they have the same behavior. For our mentality, some things are incomprehensible. The same scheme works for China. That is why it is important to have local representatives in the region.

Related: Antonov company president resigns

Does the London office cover Europe?

We work together, promoting the services of Antonov Airlines all over the world. Our offices work as a single team, we have a permanent connection. Every Monday we have a conference call. All matters are promptly discussed, I mean those issues on the clients' basis, on registration of necessary documents, and on logistics.

Where do you plan to open your offices in the nearest future?

We have a general agent in Australia. In 2017, several contracts were fulfilled in Japan. Since autumn, our representative is working in India. We have also a representative in Belorussia, and he is successfully working there. We have a person in Vietnam. They help with finding customers; they promote our services in the market.

112 Agency

Who are your customers?

The circle is wide enough. Our aircrafts are engaged in the transportation of industrial equipment. For example, equipment for the oil and gas industry, the energy industry, the aerospace industry, General Electric engines, satellites. We have also performed transportations for Boeing. They are also involved in humanitarian and peacekeeping missions and fulfill state orders.

Related: Antonov Company can renew cooperation with Russia

Do you also carry out transportation for the needs of the US military-industrial complex?

Yes, we are working with NATO and with the UN.

 Is there a demand for your services in Ukraine? Do you carry out cargo transportation?

Speaking about Ukraine, this is a very small part of our work. Transportation via Ruslan inside the country is unprofitable. If we make one flight a month from Ukraine, that is, we are taking cargo out of our country, it is good enough.

Related: Ukraine ready to open Antonov Centre in Malta

What is the age of your fleet's aircraft? When were they built?

They are quite old. We use the aircraft produced in the period from 1987 to 1994.

 For how long can they fly?

We expect that they will fly until 2030-2035. Ruslan was produced in 1987, so we expect it to work until 2032, and the newest one should work until 2039, but all the necessary forms of service, inspections, issuing opinions, and all the necessary operations on modernization should be fulfilled. About 60% of the components of our aircraft were produced in Russia.

Related: Antonov An-132D at Paris Air Show 2017

Do the state authorities realize that this is a very promising area, which should be further developed?

Of course, they do. I think that everyone understands the importance of this direction for Ukraine. We must pay tribute to the Ministry of Foreign Affairs of Ukraine: they give us significant support in foreign promoting and assistance.

Related: Ukraine plans to export Antonov planes to Kazakhstan


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