Boeing decided to save Ukraine's Antonov from the collapse

Author : Oleksiy Kushch

Source : 112 Ukraine

Boeing has decided to help Antonov aircraft design bureau and would supply the components for the production of 8 modernized aircraft a year
10:49, 3 August 2018

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Antonov state enterprise

If you have to know something about a country during your travel, you can easily "read" the information by its bills and coins. As a rule, these are either iconic historical figures, or historical turning points, or national symbols. For example, Euro Cent in Cyprus has the image of the famous "Kyrenia ship," which is kept in the museum-fortress of Kyrenia (it was found by divers in the port of the same name). And it does not matter that this artifact is now under the control of the self-proclaimed republic of northern Cyprus, occupied by the Turkish troops. If you look at the dollar bills, you can study the "dead" presidents and even see a portrait of one "non-president" - the scientist and statesman Benjamin Franklin.

Ukrainian first banknotes depicted Chersonese, and this was a symbol of our ancient history. Our 500-hryvnia note we have philosopher Hryhoriy Skovoroda, and this meant that the Ukrainians are wise philosophizing people, whom "the world has never caught" (one of Skovoroda’s most famous quotes – ed.). Few people paid attention to an inscription on the 500-hryvnia note: "Unequal equality to all" ... It is almost a model of our reality. Although there is another inscription under the image of the fountain: "Different currents flow from different tubes." Today, this is more suitable for the description of the financial flows leaving the country. Hryhoriy Skovoroda was not only a philosopher but also a visionary...

Related: Azerbaijan interested in buying ten Antonov An-178 from Ukraine

Speaking about the coins, there was a series of "planes of Ukraine", and it was not the mythical aviation of the First World War, but the most modern airplanes: AN-132 (adapted to the most extreme operating conditions), An-124 Ruslan (one of the most load-lifting aircraft in the series), and the An-225 Mriya (the pride of our air fleet, the record holder in terms of the number of various range and payload indicators).

Related: Antonov State Enterprise sees 85% increase in net profit in 2017

But the aviation industry, as well as the rocket and space industry, cannot develop without active support from the state, it's not the cultivation of "seeds for spinning," but a long-term investment and technology cycle, the implementation of which requires long-term price and exchange rate stability, incentive tools and mechanisms for protecting the domestic market. Yes, it is a pearl of any industrial sector, but at the same time this "multi-valued pearl" requires no less expensive rim.

Today, the National Bank (NBU) has pleased the numismatists with another "masterpiece" - a coin with "digging potatoes" picture, which depicts two bent old people with radiculitis, who, in order not to fall, hold each other with their foreheads. That is how the National Bank "sees" our present and near future.

Well, what about the planes? They turned out to be the tenth "business" for the current government. Old songs were decommunized together with industrial potential.

Related: Antonov to build eight planes per year

The leakage of intangible assets is dangerous because it can go to some quite "interesting" countries, for example, Iran or North Korea. Former general designer of the state enterprise Antonov, Dmytro Kyva, left for Azerbaijan to "raise" the local aviation industry. A very sensational story with a "transfer" of the "Motor Sich" factory to China. For some reason, the Chinese are not interested in creating a joint venture in Ukraine to produce helicopter engines - they prefer to give us loans for growing corn and take out the ready-made technology to their country.

Several years ago, there was a sensational story about a deal with the Saudis regarding the construction of a plant in Saudi Arabia to produce a modernized An-132. They represented this triumph of momentary greed over reason as a kind of breakthrough of Ukraine into the Arabian Desert. In civilized countries, such tricks with copyright would end with big troubles, because selling the ready-made technologies is stupid

The massiveness of the "outcome" has aroused our western friends. Filling our market with locomotives is one thing, but airplanes are something completely different. That is why Ukraine has offered assistance, which looks like "humane euthanasia." After all, if everything is left as it is, then in the conditions of termination of cooperation with the Russian Federation, Antonov will go bankrupt (with the exception of freight traffic). Where will the specialists, carriers of secret information, technologies, technical documentation go? No one hopes for the Ukrainian version of German recycling.

Related: Ukraine's Antonov An-26 performs forced landing in Egypt

Boeing has decided to help our Antonov aircraft design bureau and would supply the components for the production of 8 modernized aircraft a year under the new designation An-1X8 NEXT (An-148, An-158, An-178 family). In fact, this is the first example, when the world's largest company decided to help its competitor. By the way, Americans have never helped other countries to establish the production of aircraft.

It will allow postponing the process of Antonov's "dying" for some 5-10 years, until the old engineering cadres brought up in the Soviet higher educational institutions finally get off the stage, and the technologies created at that time would not completely die out.

In 1991-1992, Antonov could produce some 60-70 aircraft a year. Recently, this indicator ranged from zero (the last two years) to six (2012). Since 2002, the largest part of the issue was formed by military transporters An-32 (37%) and transport-passenger An-140 (33%).

It is clear that the development of Antonov might follow two directions: freight type (a basic type of activity) and passenger type (auxiliary direction). Speaking the sources of funding, it is necessary to separately allocate the defense-state order (military transport aircraft and aviation for the Ministry of Emergency Situations / Ministry of Internal Affairs) and private investment programs.

Related: Antonov enterprise cyber attack claims, publishing fake letter on website

Can the state revive its aviation industry? Given the logistics potential of our country, the population and the area of the territory, it is simply obliged to do it. Although there will be plenty of experts who will prove that it is better to flood the native sky with flying scrap metal from the African and deep Asian routes (to meet the sharply increased demand of Ukrainians for mobility). Like, why should we compete with Boeing or Airbus? But, as the history of the creation of the Brazilian Embraer shows, alternative projects with favorable starting opportunities have all chances for success. I am not even talking about the Canadian Bombardier.

Related: Antonov State Enterprise boosts net revenue by 62% in 2017

What should the state do? First, it to invest in transport logistics while attracting private partners on concession terms. Most of the Ukrainian regional centers should have their own regional airport. And a correspondent logistics center. Second, it should impose a restriction on the importation of aircraft "European license plates" into the country with a dubious operational history, increasing the requirements for the machinery in operation. Third, it should create a system of incentives for launching leasing programs for the production and operation of domestic aircraft. At the first stage, state banks can provide financing, in addition, the state can partially compensate for the interest rate under leasing contracts for companies receiving Ukrainian aviation equipment. Fourth, it is necessary to develop an air hub and cargo carrier of goods from China to Europe, as well as from other Asian countries, launching a preferential lending regime.

The purpose of the program is the development of domestic passenger transportation using short-range Ukrainian aircraft, as well as the gradual expansion of regional leadership in the segment of medium-haul routes. But the key direction is strengthening of positions in the market of freight transportation, including long-haul transportation (China-EU).

As the experience of Embraer shows, all the investments made by the state can be successfully returned during the privatization of aviation companies. In order to solve such a simple "Brazilian problem" officials will have "not to steal" for several years. For the current elites, this would be like a torture.

Related: Ukrainian 'Antonov' renews work with Russian company

This column does not necessarily reflect the opinion of the editorial board or 112.International and its owners.

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