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    Military Aviation Industry: News

    LMFS
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    Post  LMFS Thu Mar 18, 2021 12:42 pm

    Rostec to merge Sukhoi and MiG companies into a single corporate center for aircraft construction

    According to the Corporation, the creation of a single UAC aviation engineering cluster will save up to 130 billion rubles.

    MOSCOW, March 18. /TASS/. The total optimization effect of creating a single aviation engineering and design center of the United aircraft Corporation (UAC) in Moscow, which will include Sukhoi and MiG companies, should amount to 130 billion rubles. This was reported to journalists in the state Corporation "rostec" with reference to the General Director of UAC Yuri Slyusar.

    "Structural changes, the cost optimization program, transformation of the industrial model, research and development block, digital transformation of the UAC are aimed at increasing capacity utilization and increasing labor productivity. The total optimization effect from the ongoing transformations should amount to 130 billion rubles, " Rostec quoted Slyusar as saying.

    According to the state Corporation, rostec will unite UAC, Sukhoi and MiG companies into a single corporate center for aircraft construction, which will consolidate the management of aircraft programs and other UAC assets. The group's engineering and design functions will be separated into a separate center located in Moscow, which will include all aviation design bureaus (KB). Moving aviation design bureaus to other regions is not on the agenda, Rostec said.

    "Such decisions were announced by Sergey Chemezov, General Director of rostec state Corporation, at a meeting with the management of the United aircraft Corporation and its leading engineering centers, where they discussed the development of the aircraft industry in the coming years," the state Corporation said.

    According to Rostec, the changes will increase the UAC group's economic sustainability, optimize the administrative and managerial staff, and reduce non-production costs and debt burden.
    Center for aircraft construction

    The UAC corporate center for aircraft construction, which will include Sukhoi and MiG, will consolidate the functions of managing aircraft programs, and will also become the management organization for Tupolev, Ilyushin and Irkut Corporation.

    "We are forming a single management organization and a single design competence center for all UAC companies in Moscow. Systemic reforms should improve the company's structure and address issues of its financial stability, increase the competitiveness of domestic civil aircraft, and meet Russia's significant needs for modern passenger aircraft. Given the importance of the task, I decided to take the issue of corporate reforms under my personal control and head the Board of Directors of UAC," rostec quoted Chemezov, General Director of the state Corporation.

    They said that the optimization will not affect engineering and design personnel. Design schools will retain their independence, get new opportunities for development, as well as improved working conditions in the format of a Single engineering and design center. "The reform will be implemented in stages over several years. At the same time, it is still necessary to work out all the key changes with the design unit, directorates of aircraft programs, and production sites," the state Corporation explained.

    https://tass.ru/armiya-i-opk/10932885

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    miketheterrible
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    Post  miketheterrible Thu Mar 18, 2021 1:05 pm

    This was inevitable. Sukhoi was doing well while Mikoyan was struggling. Mikoyan has great engineers and capabilities but their designs weren't in demand compared to Sukhois work.

    Hopefully this will reduce costs and increase production capabilities along with fast pacing r&d for things like MiG-41.
    PapaDragon
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    Post  PapaDragon Thu Mar 18, 2021 3:13 pm

    And was MiG even a serious company anymore, especially compared to Sukhoi?

    It was like comparing Rover with Toyota

    LMFS
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    Post  LMFS Thu Mar 18, 2021 4:13 pm

    They are not saying MiG is absorbed by Sukhoi, just that all bureaus will be integrated in a single structure, that includes also Tupolev, Ilyushin, Irkut and maybe others.

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    The_Observer
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    Post  The_Observer Thu Mar 18, 2021 5:15 pm

    LMFS wrote:They are not saying MiG is absorbed by Sukhoi, just that all bureaus will be integrated in a single structure, that includes also Tupolev, Ilyushin, Irkut, and maybe others.

    Will future products still reflect the individual identities of the constituent parts (of the conglomerate structure) or will they now have a broader brand identity?
    kvs
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    Post  kvs Thu Mar 18, 2021 7:40 pm

    The_Observer wrote:
    LMFS wrote:They are not saying MiG is absorbed by Sukhoi, just that all bureaus will be integrated in a single structure, that includes also Tupolev, Ilyushin, Irkut, and maybe others.

    Will future products still reflect the individual identities of the constituent parts (of the conglomerate structure) or will they now have a broader brand identity?

    Yes.  UAC does this now.

    These consolidation efforts have borne fruit over the last 20 years since they remove pointless bureaucratic overhead and none of these military contractors,
    including the US ones, operate in a competitive market.   They exist on government contracts which automatically selects who "wins".   The consolidation
    keeps the valuable design bureau resources alive and is really a management reshuffle.   If Mig is not going to be deleted since it is too valuable.

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    Hole
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    Post  Hole Thu Mar 18, 2021 8:41 pm

    I think this is more about the factories then the design bureaus. A factory in Moscow belongs to the MiG company and KnAAPO belongs to Sukhoi. The design bureaus will still be "separate".
    LMFS
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    Post  LMFS Thu Mar 18, 2021 11:17 pm

    The_Observer wrote:Will future products still reflect the individual identities of the constituent parts (of the conglomerate structure) or will they now have a broader brand identity?

    They have said repeatedly that the design bureaus names, design school and staff will be left untouched. They referred to duplicated overheads like management and auxiliary departments and bureaucratic or legal hurdles for the cooperation of the companies as some of the main reason for the integration. Also a factory that belongs or is linked to a certain bureau may not be loaded as regularly and be as productive as when it is an asset of the whole UAC. This is already happening, but the bigger the integration, the easier it becomes to share and smooth out the work load. Also things like test facilities that would need to be duplicated for two bureaus can be optimized if shared and therefore things like instrumentation and capacities can be upgraded because there is a much bigger business supporting them. Hi tech tends naturally to integration because of unavoidable economical constraints.

    Having said that, there are still concerns and suspicion and they might be fair, but I cannot say that I do not understand or share the reasons adduced for the further consolidation within UAC

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    JohninMK
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    Post  JohninMK Fri Mar 19, 2021 12:18 am

    This is a massive change driven above all by the conditions of a financial restructuring. Leading to a very large redeployment of Russian workers, releasing manpower for other roles.

    There looks to be large layoffs in no longer duplicated middle management roles. Sukhoi alone was already shedding near 10% of its total workforce over last year and this, whilst MiG lost near 25% HQ employees last year. A large move of office staff out of expensive Moscow down to the manufacturing plants. The big change seems to be a much closer identification of a brand with a location.

    Interesting to note that a Unified Engineering and Design Center will also be established to unite the existing separate design bureaus at Khodynka Field in Moscow.

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    LMFS
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    Post  LMFS Fri Mar 19, 2021 2:43 pm

    I think it is not coincidence that this is published today in TASS:

    Experts: it is necessary to keep the competition of engineering schools in a single UAC aviation cluster

    The UAC corporate center for aircraft construction, which will include Sukhoi and MiG, will consolidate the functions of managing aircraft programs, and will also become the management organization for Tupolev, Ilyushin and Irkut Corporation."

    MOSCOW, March 18. /TASS/. Competition between creative engineering teams should be preserved when creating a single aviation engineering and design center of the United aircraft Corporation (UAC) in Moscow, which will include Sukhoi and MiG companies. This opinion was expressed to TASS by the Executive Director of the industry information and analytical Agency AviaPort Oleg Panteleev.

    "There is a potential to increase efficiency, to reduce costs, and this opportunity should be taken advantage of. But at the same time, when implementing reforms, it is really important to preserve both design schools and internal competition between creative engineering teams," Panteleev believes.

    He stressed that, if we talk about combat aviation, it is fundamentally important that the UAC can develop, produce, and modernize the entire line of combat aircraft that the Russian defense Ministry needs and, importantly, which is in demand on the world market and can be exported.

    "From this point of view, it is important that UAC retains the competencies that both Sukhoi and MiG Corporation still have. Over the past decades, Sukhoi has had developments in heavy fighters, MiG has had developments in light fighters and air interception complexes, that is, in interceptor aircraft. It would be important that these competencies are not lost within the framework of the merger of companies, "the Executive Director of AviaPort explained.

    As for eliminating duplication in auxiliary areas of activity, such as accounting, "we can assume with a high degree of probability that this will not lead to the extinction of a particular design school," the expert noted. "As a result, even within the same company, it is possible to organize internal creative competition of engineering teams so that the soundest and most powerful ideas can be implemented," Panteleev said.

    The expert noted that it is necessary to determine whether the potential of Rostec's stated savings from optimization of 130 billion rubles exceeds the possible risks. "If you do the transformation correctly: consult with labor collectives, take such measures that will not force engineers to run to other enterprises in search of a better share, then everything becomes obvious. We can, of course, recall the well-known principle that 80% of value is created by 20% of specialists, but we must state that in General, alas, our aviation industry has already gone through such a personnel " drying up "that the" extra" 80% left 20 years ago, " he stressed.
    You need to save your brands

    In turn, the honored pilot of Russia, major General Vladimir Popov, fears that the merger of design bureaus may lead to the loss of the competitive factor and, as a result, to the extinction of world-famous aviation brands since Soviet times.

    "It is not worth combining them so quickly and in favor of Western economic development trends. In the Soviet and now Russian aviation industries, there was a good trend when the main design bureaus were divided, which we have branded and were known all over the world," the expert said.

    According to him, a metered-dose approach is needed. "Competition isn't just about getting an order out of someone's throat. No. The competition consists in the fact that people come there who are already differentiated: some are good at making fighters, some are good at making bombers, and some are good at making wide-body planes. Let them do it. There will be more benefits, " he explained.

    "If the people who create [planes] will be proud to be canonized [by designers], "he said.] Yakovlev, Ilyushin, Sukhoi, then there will be a result, " the expert said.
    Design bureaus will remain Autonomous

    Editor-in-chief of the portal Avia.ru Roman Gusarov told TASS that changing the structure of the UAC will significantly improve the result of its activities. "The structure of the UAC shows insufficient efficiency - there are effective divisions, and there are those whose activities do not give proper results. The request for optimization of the Corporation has been hanging for a long time, and we need to start this work," Gusarov said.

    Among the possible advantages of UAC optimization are improving the structure, getting rid of duplicate assets, and optimizing the management and maintenance staff, the expert believes. "The design bureaus themselves will still remain Autonomous, because each design Bureau has its own specialization and they conduct their own projects. Design bureaus will not be reduced and will remain inside the updated structure, " Gusarov said.

    Optimization will also improve the productivity and quality of labor at UAC enterprises. "Aircraft factories are undergoing automation and modernization, and Metalworkers are being replaced by machining centers. As a result, productivity increases, salaries increase, " Gusarov said.

    A possible negative aspect of modernization may be a reduction in the number of UAC personnel, the expert added. "Some people will have to leave, there will be a reduction in support services and duplicate units," he said.

    Similar processes took place in the aircraft industry in Europe and America, Gusarov stressed. "Once Europe United and created Airbus, and now this company accounts for up to half of the global civil aviation market," the expert noted.
    Unified aviation engineering cluster

    Earlier, the press service of rostec state Corporation, with reference to UAC General Director Yuri Slyusar , reportedthat the total optimization effect from the creation of a single UAC aviation engineering and design center in Moscow, which will include Sukhoi and MiG companies, should amount to 130 billion rubles.

    The UAC corporate center for aircraft construction, which will include Sukhoi and MiG, will consolidate the functions of managing aircraft programs, and will also become the management organization for Tupolev, Ilyushin and Irkut Corporation. Rostec said that the optimization will not affect engineering and design personnel. Design schools will retain their independence, get new opportunities for development, as well as improved working conditions in the format of a Single engineering and design center.

    https://tass.ru/ekonomika/10938619

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    Kiko
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    Post  Kiko Fri Mar 19, 2021 8:38 pm

    Russian aviation industry gets rid of ballast
    19 March 2021

    The Russian aviation industry is preparing for a major reform. UAC, together with Sukhoi and MiG companies, will form a single corporate aircraft manufacturing center. At one time, eminent European design bureaus found the strength to unite. This is how the world leader in aircraft manufacturing appeared along with Boeing - Airbus. Will Russia succeed?

    The Russian aviation industry awaits a serious reform under the leadership of Rostec CEO Sergei Chemezov. He will head the board of directors of the United Aircraft Corporation (UAC), taking the place of the head of the aviation cluster, former Defense Minister Anatoly Serdyukov, the state corporation said.

    Chemezov explained that he decided to take this post "taking into account the importance of the task" in order to "take the issue of corporate reforms under personal control." The state corporation explained that he would personally supervise all reforms in the UAC.

    “Systemic reforms should improve the structure of the company and solve the issues of its financial stability, increase the competitiveness of domestic civil aircraft and cover the significant needs of Russia in modern aircraft for passenger transportation,” Chemezov said. As explained in Rostec, UAC, together with Sukhoi and MiG companies, will enter a single corporate aircraft building center, the press service of the Rostec state corporation reported. The engineering and design functions of the group will be separated into a separate center, which will be located in Moscow.

    Earlier, RBC reported that the leading aviation design bureaus will be merged into one center on the Khodynskoye field, the MiG and Sukhoi companies will cease to exist as independent legal entities, but the brands well-known to everyone will remain. At the same time, the administrative apparatus of the UAC will be reduced from five thousand people to 500, but there is no talk of the dismissal of engineers.

    What are the advantages and dangers of the even greater centralization of the Russian aircraft industry?

    Consolidation of disparate structures will help reduce costs and debt burden of the company, and increase the economic stability of the UAC.

    “It is definitely necessary to reform. The current structure of the UAC is redundant, resource-intensive and inefficient. It is obvious. The corporation has constant losses and debts accumulate, ”says Roman Gusarov, editor-in-chief of the Avia.ru portal.

    This is partly due to the bloated staff of administrative workers, accounting, and the economic department. “And everywhere there are only bosses who, in fact, do not participate in the creation of the product. As a result, there is no opportunity to hire high-quality specialists, because all are sold by thousands of people who are not engineers, ”the expert adds.

    “If instead of five accountants we have two accountants, will this lead to the destruction of design schools? What if there are fewer lawyers or procurement specialists? And there are a lot of such “ifs”, ”Oleg Panteleev, editor-in-chief of Aviaport, agrees.

    “UAC will give one left to Boeing and Airbus in terms of the number of kilometers of barbed wire that surround all these sites. At the same time, the number of aircraft produced per square meter of occupied area, to put it mildly, does not correspond to the indicators of our competitors ", says Panteleev.

    There are many different design bureaus and scattered infrastructure in Russia. Design offices occupy buildings that are more than half a century old, and they are all scattered across different geographic locations, the expert notes. Therefore, the association even optimizes the logistics for various meetings.

    “The advantages of consolidating and centralizing management functions and support functions are obvious. People will be gathered at one well-equipped site, ”Panteleev says.

    Combining different design bureaus under one roof will not destroy the illusory internal competition. Gusarov is confident that it will be possible to preserve the independence and autonomy of each design bureau simply because they have completely different areas of work that cannot be combined.

    “The internal competition of design thought is, in fact, a thing of the past long ago. It has turned, in fact, into competition for budget funds, for resources. Without government assignments and funding, engineers cannot launch a combat aircraft. And the state cannot finance the development of two identical aircraft at the same time from different design bureaus in order to see who will get the best car. Nobody else in the world does this, neither the United States nor Europe. On the contrary, they consolidate the maximum resources in the same hands, and only then a high-tech advanced product is obtained, ”the interlocutor argues.

    Creation of an airplane, especially from scratch, is very expensive, requires billions of dollars and decades of time.

    “The example of Europe is indicative. At one time there were many dying design bureaus, albeit eminent ones. They found the strength to unite.

    As a result, we got one of the two largest aircraft manufacturers in the world - Airbus, which occupies half of the world's civil aviation, ”recalls Gusarov. In this regard, Russia is following the already beaten path.

    “We need to compete not internally with each other, when Tupolev and Sukhoi pull the blanket of budget money over themselves, but together make good products and compete with external products from Boeing and Airbus. This is a new level of competition. This requires modernization, money for new equipment, science, technology - and good specialists who need to be paid a decent salary. A large, but hungry army will be less efficient than a well-fed one, ”says an industry expert.

    Another thing is that so far there is no detailed reform plan to assess how this will all be implemented in the end. The obvious disadvantage is already clear - thousands of people will have to look for a new job. However, no optimization process is complete without this.

    Another threat is the risk that the reform will be carried out ineffectively.

    “Even the most wonderful thing can be ruined with extraordinary ease. First, an atmosphere of mistrust and uncertainty can be created. Secondly, with the correct staff reduction, we should get an increase in the efficiency of the remaining employees, and with the wrong choice of employees, everything will be the other way around: people will stop working altogether, but they will be loyal to the management, ”says Oleg Panteleev.

    “As for the promotion of internal competition in the design bureau, this can be organized. When it comes to the development of a new unit or a new aircraft, traditionally, even in one department, a large number of alternatives were considered. It's a management issue. The worst thing is when some leader makes voluntaristic decisions that he likes this way, and nothing else, ”the interlocutor believes.

    Among the disadvantages may be the risks of sanctions: when instead of one enterprise, the entire industry will be subject to restrictions. However, it is not worth living with an eye on the sanctions, besides, Rostec has already fallen under them, Gusarov said. “There will be no joint projects with Western countries for decades to come in aviation, all new projects will most likely be built with domestic equipment,” says Panteleev.

    In any case, experts believe that the reform of the KLA is indispensable. “The price of the issue is savings of 130 billion rubles.

    Is it worth starting a transformation for the sake of saving 130 billion rubles? In my opinion, worth it. This is a really big amount.

    But the paralysis of the UAC is not worth the money for a couple of years, ”Panteleev believes.

    The transformation gives certain opportunities to the Russian aviation industry, the question is how the management can take advantage of these opportunities. “Sergey Chemezov will manage the process. He takes responsibility, he himself appointed the last one. I think it’s not in his interests to let things go further, ”the source concludes.

    Text: Olga Samofalova

    https://m.vz.ru/economy/2021/3/19/1090161.html

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    LMFS
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    Post  LMFS Sat Mar 20, 2021 1:57 am

    Serdyukov is leaving yet another position? Laughing
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    Post  Tingsay Sat Mar 20, 2021 6:45 am

    Sukhoi and MiG will merge into one.


    https://english.pravda.ru/amp/news/business/147443-sukhoi_mig/


    It was inevitable, MiG has been struggling for a while now

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    GarryB
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    Post  GarryB Sat Mar 20, 2021 9:07 am

    Essentially the situation was that all the different design bureaus were completely separate operational design bureaus that had relationships with radar and avionic and engine producing design bureaus and the factories that made all the different components and assembled it all into finished products.

    Each design bureau had specialist areas, but they were not limited to those areas and could effectively branch out to make anything they liked... there were a lot of situations with overlap... Tupolev made interceptors (Tu-128) and so did MiG (MiG-25 MiG-31) but so did Sukhoi (Su-9/11/15/21).

    The point is that each design bureau had to manage projects so they had full management structures and design departments etc etc, but combining them as departments in UAC (OAK) their management structures become duplicated and redundant.

    Hense what they are talking about is merging the management portion of all the design bureaus into one management group for UAC, but keeping the design and development of each design bureau intact, with shared resources and facilities.

    It essentially means getting rid of paper pushers but keep designers and people who get things done.

    Management is necessary, but this gets rid of the duplication which makes sense.

    Keeping the design bureaus as separate competing departments makes sense because sometimes the results are different enough to make both products useful, and in some cases products might be better suited to export countries needs than the original product.

    Edit:

    MiG are actually rather busy at the moment, the MiG-29M2 seems to be selling well and MiG-35s about to enter Russian Service, plus upgrades of the MiG-31K and the MiG-31BM being a solid and not replaceable aircraft in their inventory with work on the MiG-41 replacement going ahead right now.

    Pretty sure that soon come countries are going to realise with the F-35 debacle and the cost of the Rafale and Typhoon that a straight forward simple but well equipped fully functional multirole fighter that is not expensive to buy or operate actually makes more sense than the stupid super planes being bandied about recently that current owners find they can't afford to operate let alone buy enough for their operational needs.

    It took the horrendous cost of 20 million per aircraft for the F-15 for the Americans to look to a cheaper simpler design as a numbers fighter... of course these days you can't buy an attack helicopter for that money.
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    Post  LMFS Wed Mar 24, 2021 4:38 am

    Teaser action by Rostec:

    A fundamentally new aircraft will be presented at the MAKS-2021 air show

    The question of whether the new aircraft will be military or civilian remains unresolved.

    Rostec will present a "fundamentally new aircraft" at the MAKS-2021 air show in July. This was reported to RIA Novosti by the press service of the state Corporation.

       "We want to present as clearly as possible all the achievements of Russia in both military and civil aircraft construction, including promising models of aircraft, helicopters, engines and other components, advanced onboard systems. New products are also planned, in particular, we will show a fundamentally new aircraft for the first time, " Rostec noted.

    At the same time, the question of what the new aircraft will be - military or civilian, not to mention other details of the future novelty, remained unresolved.

    All Rostec's aviation-related holdings will participate in MAKS, so there is only one way to find out which aircraft will be shown to us-wait for the air show itself.

    https://tvzvezda.ru/news/2021323134-nUd2L.html

    I hope this is something substantial, there are a few known programs for which we are still waiting to see a layout... any bets? Very Happy

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    Backman
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    Post  Backman Wed Mar 24, 2021 5:00 am

    LMFS wrote:Teaser action by Rostec:

    A fundamentally new aircraft will be presented at the MAKS-2021 air show

    The question of whether the new aircraft will be military or civilian remains unresolved.

    Rostec will present a "fundamentally new aircraft" at the MAKS-2021 air show in July. This was reported to RIA Novosti by the press service of the state Corporation.

       "We want to present as clearly as possible all the achievements of Russia in both military and civil aircraft construction, including promising models of aircraft, helicopters, engines and other components, advanced onboard systems. New products are also planned, in particular, we will show a fundamentally new aircraft for the first time, " Rostec noted.

    At the same time, the question of what the new aircraft will be - military or civilian, not to mention other details of the future novelty, remained unresolved.

    All Rostec's aviation-related holdings will participate in MAKS, so there is only one way to find out which aircraft will be shown to us-wait for the air show itself.

    https://tvzvezda.ru/news/2021323134-nUd2L.html

    I hope this is something substantial, there are a few known programs for which we are still waiting to see a layout... any bets? Very Happy

    Russia has been tossing around the idea of a supersonic civilian jet for awhile now. Putin said it at the Tuplolev plant a few years ago. And there was a directive to study it. They have the experience with the tu-144. There was the Sukhoi Gulfstream project in the 90's. So I think its a possibility.

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    PapaDragon
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    Post  PapaDragon Wed Mar 24, 2021 5:04 am


    Screw civilian crap, we all know what those look like

    I want MiG-41 (mockup alone would be enough for now)
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    Post  LMFS Wed Mar 24, 2021 5:40 am

    PapaDragon wrote:
    Screw civilian crap, we all know what those look like

    I want MiG-41 (mockup alone would be enough for now)

    Not bad but given it is purely domestic I doubt it...I wishfully hope it is LMFS/LFI/PLIB or call it what you want... wishing is for free Razz
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    Post  Backman Fri Mar 26, 2021 4:19 am

    It could be a Pak Da unveil. Whichever project the rumor mill is heating up about from now till July will be it.
    magnumcromagnon
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    Post  magnumcromagnon Fri Mar 26, 2021 4:34 am

    I doubt that it's any of those, it's probably going to be something like a 1:1 mockup of the Il-276.
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    Post  PapaDragon Fri Mar 26, 2021 4:54 am

    magnumcromagnon wrote:I doubt that it's any of those, it's probably going to be something like a 1:1 mockup of the Il-276.

    That would be literally blowing smoke up people's asses with this announcement then

    Everyone already saw how 276 will look like

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    Post  Backman Fri Mar 26, 2021 5:34 am

    magnumcromagnon wrote:I doubt that it's any of those, it's probably going to be something like a 1:1 mockup of the Il-276.

    What ? Nah. UAC wouldn't be hyping something like that 4 months before MAKS.

    Il 276 had a scale model at maks 09

    It's basically guaranteed to be something ballsy.
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    Post  LMFS Fri Mar 26, 2021 2:07 pm

    It will be the Yak-40 with superconductor electric motor
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    Post  GarryB Sat Mar 27, 2021 4:53 am

    This is a first view of a fundamentally new aircraft, so my guesses would focus on the new LMFS, or new high speed naval helicopter, or possibly the new strategic bomber, the new strike platform to replace the Su-25, the new interceptor often called MiG-41, or it could be the upgraded version of the Il-106 ready for production or Slon in an actual prototype form as opposed to drawings and speculations.

    Will be interesting to see what they come up with... it always is.
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    Post  Arrow Sat Mar 27, 2021 12:01 pm

    The MiG 41 is reportedly in its early design phase. It would be a huge shock if they presented a prototype this year. Same for LMFS and Slon.

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