Governments said to have reached agreement on establishing 'Russianised' Embraer 170 production line

The future of the Sukhoi Russian Regional Jet (RRJ) has been unexpectedly cast into doubt by a provisional agreement between the Brazilian and Russian governments involving the potential sale of Sukhoi Su-35 fighters in apparent exchange for the setting up of a "Russianised" Embraer regional airliner production line in Russia.

The deal was partially hatched by Russian president Vladimir Putin during a recent visit to Brazil, where talks were held with president Lula da Silva, according to Russian financial documents seen by Flight International. As part of the negotiations Brazil is also offering Embraer 170 regional airliners, previously earmarked for troubled US Airways, to Aeroflot at a significant discount.

If confirmed, the Embraer 170 sale, covering up to 50 aircraft, would probably be tied to the projected establishment of a Russian Embraer Jet (REJ) assembly line at Komsomolsk-on-Amur Aviation Production Association (KnAAPO), effectively killing the RRJ project.

According to the financial report, the Russian government is preparing to negotiate its way out of the RRJ by offering the partners (including engine maker Snecma) a slice of what it is describing as the "Russian-Brazilian regional airplane". Negotiations with the Europeans were expected to start late last week during Russian prime minister Mikhail Fradkov's visit to France.

The talks were expected to detail proposals to several companies including Snecma and Thales Avionics on potential packages for the new Russian-Brazilian aircraft. In bare outline the report proposes a hybrid solution that will see Embraer design the airframe and major components, with systems coming from the RRJ project. Production would be aimed at the original 2007-8 timeframe of the RRJ. Initial assembly would be based on the ERJ-145, but could be extended to a "Russianised" derivative of the RRJ-sized Embraer 170. Embraer declines to comment.

The deal appears ultimately contingent on the sale of Su-35s to Brazil for a fighter competition that has been delayed several times. According to the report, Putin's delegation discussed delivery of the first batch of 12 aircraft to Brazil in 2008, with further batches of up to 50 more aircraft up to 2012.

The decision on the fighter selection has recently been slipped to the first quarter of 2005. Officially this was tied to the recent dismissal of Brazilian defence minister Jose Viehos Filho, but sources indicate the delay is tied to extended negotiations over the new Russian deal.

Aeroflot officials have dismissed comments by Anatoly Gusarov, director general of Belarus carrier Belavia, that both airlines were to order Embraer aircraft for 2006 delivery.

GUY NORRIS / LOS ANGELES

Source: Flight International