Rostec State Corporation (Rostec) will unite United Aircraft Corporation (UAC), Sukhoi and MiG companies into a single corporate aircraft manufacturing center, which will consolidate the management of aircraft programs and other UAC assets. The engineering and design functions of the group will be separated into a separate center, which will be located in Moscow – it will include all aviation design bureaus. The UAC Corporate Aircraft Center, where Sukhoi and MiG will join, will consolidate the functions of managing aircraft programs, and will also become the managing organization for Tupolev, Ilyushin and the Irkut corporation as well.
The objectives of the transformations are to increase the economic sustainability of the UAC Group, optimize the administrative and managerial staff, and reduce non-production costs and debt burden. To control the ongoing transformations, the head of Rostec, Sergei Chemezov, will head the UAC board of directors. The optimization will not affect the engineering staff. Design schools will remain independent, receive new opportunities for development, as well as improved working conditions in the format of the Unified Engineering and Design Center. The center will be located in Moscow, where the existing test and bench infrastructure of the UAC is concentrated.
The Russian aviation still preserves traces of the Soviet Union, when the structure of aircraft design and production was divided among several specialized bureaus. While the fighter planes were in charge of Sukhoi and MiG, the bombers were the responsibility of Tupolev. Unlike in the United States, where military projects are disputed by several companies in Russia there is no such competition after all the main manufacturers are controlled by the government. Amidst falling international sales and U.S., European Union sanctions, Russian aircraft industry is facing tremendous pressure to stay aloft. The merger between these offices will generate savings of around $1.75 billion and will not involve a reduction in staff.
The United Aircraft Corporation (PJSC UAC, part of the Rostec State Corporation) was established in 2006 with the aim of consolidating the assets of the largest Russian airlines. PJSC UAC was established in accordance with RF Presidential Decree No. 140 dated February 20, 2006 for the protection and development of the scientific and industrial potential of the Russian aircraft industry to implement long-term aviation programs. UAC encompasses about 30 enterprises and is one of the largest players on the global aviation market. Companies within the structure of the Corporation hold rights to such world-famous brands as “Sukhoi,” “MiG,” “IL,” “Tu,” “Yak,” “Beriev,” as well as the new SSJ 100 and MS-21 brands.