The state-run Antonov Aeronautical Company (consisting of the Antonov Aeronautical Design and Production Complex, the Kyiv-based Aviant Aircraft Factory, and the Kharkiv-based state-run Civil Aviation Enterprise No. 410) is promising that the unfavorable period in the national aeronautical industry will soon be over. The Antonov Company board of directors chairman Dmytro Kiva says that this optimism is based on governmental support for this industry as a whole and on the reactivation of some crucial businesses.
In particular, things have been gradually improving at the Kyiv-based state-run aircraft factory Aviant since the government decided last July to merge it with the Antonov Company. But even here there is room for scandals: the former Aviant management, all of whom are now, according to the acting general manager Mykola Pidhrebelny, are on sick leaves, are being accused of financial machinations and embezzling the factory’s money. The case is now being investigated by prosecutors on the request of Aviant’s workforce.
Besides, Aviant has been subjected to a number of checks by the Auditing Department since the end of August. The department is going to announce the official results of this auditing in October. According to Pidhrebelny, the factory is short of hundreds of millions of hryvnias.
Nevertheless, as Kiva and Pidhrebelny assured journalists, what is high on their agenda is not court litigations with the former plant management but the speediest possible recovery of aircraft production at Aviant. For example, Pidhrebelny announced that the AN-148 aircraft would enter mass production before the end of this year.
“We are going to take all the necessary measures for this. And we will thus prove that the plant is capable of manufacturing airplanes,” he says.” But had the Cabinet and the Ministry of Industrial Policies not intervened, the plant would have closed in a matter of months.” In the words of the acting general manager, these measures allowed the plant to begin paying off credits and back wages. In particular, 317 million hryvnias’ worth of credits have already been paid off, although until recently the factory was on the verge of bankruptcy, the property was mortgaged, or sometimes even remortgaged, says Pidhrebelny.
Kiva is urging Aviant to fulfill the many contracts the factory has. “There’s lots of work. The factory does have contracts, and the prospects for making planes are good. It is the AN-148, AN-70, and AN-32,” the chairman of the Antonov Company board of directors says. “It is very important for us now to get the production line working at the Kyiv plant.”
Yet Aviant is short of personnel, for it has only 750 employees, instead of the required 5,000, says Pidhrebelny. And although 5,000 is too high a figure in the present-day conditions, the factory needs 2,000 highly-skilled specialists today, even though it has not yet begun mass production.
Kiva says that Aviant used to turn out up to 200 aircraft a year. “But I would say the plant has been a small-lot, rather than a large-lot, production enterprise in the past few years. So we must restore the good name of Aviant,” he says.
However, Kiva notes that there still are many problems on this way, including inadequate funding, the above-mentioned shortage of skilled personnel, and high wear and tear of the shop-floor equipment. The company is so far going to solve the latter problem at the expense of the profits it has made. It plans to finalize the re-equipment program, which will last for two more years. The chairman of the Antonov Company Board of Directors does not conceal that it would be a good idea if the state reserved at least 50 percent of a state-run business’s net profit to this end — now, under the applicable law, this money goes to the state budget.
“The number one task is to reduce the production costs. Otherwise we will be uncompetitive even with our relatively low wages,” Kiva continues. “Besides, there is a legislative problem. For example, we want to sell planes to Africa. It is a very promising market, and we are eager to do this. But there are a number of legislative restrictions. For example, as a state-run business, we have no right to set up joint ventures.”
According to Kiva, the Antonov Company has proposed some legislative changes, but parliament is not working now anyway. “I still believe that we will eventually come to this,” says Kiva with optimism.
