The Russians are Coming

Looks like Boeing may have some competition for the Air Force tanker contract after all.

According to the Seattle Times, Russia's state-owned aircraft company will unveil plans on Monday to bid for the $40 billion deal, competing directly against the U.S. defense giant.

United Aircraft of Moscow plans to unveil a U.S. partner and offer a modified version of its Ilyushin Il-96 wide-body plane, said John Kirkland, a Los Angeles lawyer representing the group.

The still-unidentified partner, "a U.S. public company and existing defense contractor," would assemble the planes in the U.S., he said. The Russian interest in the tanker bid was first reported Friday by The Wall Street Journal.

Obviously, United Aircraft is a long shot to win the contract. Mr. Kirkland acknowledges there are security issues and limitations on buying defense hardware from Russian firms. But he claims the tanker version of the IL-96 meets all of the requirements outlined in the Air Force's request for proposal (RFP). And, the Russian jet is significantly cheaper than the Boeing entry, based on the 767 jetliner.

The Russian firm jumped into competition after Airbus's defense arm (EADS) lost its American partner. Northrop-Grumman dropped out of the tanker bidding last week, claiming the current
RFP favors Boeing. EADS is currently searching for a new partner, and has asked DoD for a 90-day extension of the bidding deadline, so it can decide how to proceed.

One aerospace analyst, Richard Aboulafia of the Teal Group, described the Russian proposal as "bizarre." He told the Times that the IL-96's operating efficiency is closer to that of the KC-135, the four-engine, 1950s-era jet the new aircraft is designed to replace. But United Aircraft is supposedly a two-engine variant for the tanker competition. Introduced in the late 80s, only 20 of the four-engine, passenger version of IL-96 were ever built.

United Aircraft's U.S. representative freely admits that the company needs a U.S. manufacturing and maintenance base to have a shot at the tanker contract. Needless to say, it will be interesting to see if the Russians can actually get a U.S. aerospace firm to join the project.

But Russia's real objective isn't winning the tanker contract. With the required maintenance and manufacturing facilities, United Aircraft could begin marketing regional jets to U.S. carriers, a market that is also quite lucrative. Apparently, Russian Prime Minister Vladimir Putin wants to sell the Antonov 148 in America; Mr. Kirkland describes it as "Putin's favorite airplane." Getting a U.S. partner (ostensibly to bid on the tanker deal) is the first step in that process.
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In case you're wondering, the Russian Air Force uses the IL-78 Midas for aerial refueling. The Midas is based on the IL-76 Candid airframe. Russia current has 19 IL-78s in service and the aircraft has been exported to several foreign customers, including an American firm, North American Tactical Aviation. That company has been in the running for DoD air refueling contracts, recently opened to private vendors.