From Aviation Week

 

Sukhoi Chief To Head MiG; Integration Goal

Jan 13, 2009

By Alexey Komarov

 

The head of Sukhoi’s holding company, Mikhail Pogosyan, has taken the general director’s chair of the rival fighter manufacturer MiG Corp. with an aim to integrate the latter company into United Aircraft Corp.’s (UAC) combat aircraft division.

 

MiG — which has in its structure a design bureau, two serial manufacturing plants in Moscow and Lukhovitcy, and also the controls activity of engine manufacturers Chernyshev and Klimov — needs urgent financial recovery. A recent audit revealed that its debt amounted to roughly $1.5 billion, according to reported figures. The collapse of a $1.3 billion export deal with Algeria on deliveries of 28 MiG-29SMTs and six MiG-29UBTs, as well as a lack of domestic orders, heave created serious problems with the corporation’s cash flow.

 

One of Pogosyan’s new tasks is to improve MiG’s financial position prior to its inclusion into UAC. He also intends to integrate both fighter manufacturers, Sukhoi and MiG, into a single efficient structure, which will develop, manufacture and support combat aviation UAC products.

 

“Our aim is to gain [synergistic] effect through infrastructure ... optimization, manufacturing cost [cutting], single technical politics development [and] after-sales service improvement,” Pogosyan said in his inauguration speech at MiG. He retains his posts of vice president of UAC and Sukhoi general director.

 

The new appointment was supported by the government, which already decided to inject 15 billion rubles ($500 million) into its establishing capital fund. The Russian defense ministry recently signed a contract with MiG worth more than 20 billion rubles to acquire 28 MiG-29SMTs originally intended for Algeria, and is negotiating the purchase of the remaining MiG-29UBTs from this batch.

If they have started saying synergistic then it is all down hill from here for Russian military aviation.