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Homepage »Industry » Interview
All About Aircraft, Titanium And The Research Center
Tuesday August 14, 2018 12:46 MSK / Yulia Kuzmina
Interview with the President of Boeing in Russia and the CIS Sergei Vladimirovich Kravchenko
Sergei Kravchenko
Sergey Kravchenko is Boeing International’s president of Boeing Russia/CIS. He is responsible for leading all Boeing business activities in Russia and Commonwealth of Independent States (CIS) countries and for directing a country team composed of business unit leaders from each sector of the company. In addition to his role as president of Boeing Russia/CIS, Kravchenko was recently named the Innovation Accelerator Leader for Boeing Global Services. In this role, Kravchenko will work to sharpen and accelerate the focus on innovation within Global Services, engaging with the Global Services Strategy team as well as HorizonX and Corporate Strategy to ensure there is an innovative process that drives the faster-cycle, high-volume innovation needed within the services business. Before his appointment to president of Boeing Russia/CIS (1998 to 2001), Kravchenko was the Boeing Commercial Airplanes vice president of Cooperative Programs and Business Development for Russia/CIS. In this role, he coordinated and directed Boeing Commercial Airplanes strategy development, industry participation, technology design, commercial aviation services and new business development programs. He also provided direct sales support of commercial airplanes to Russia/CIS. Kravchenko also served as the director of international engineering cooperation programs in Russia (1996 to 1997). He managed the Boeing Technology and Design Centres in Moscow, which now involve more than 2,000 engineers and scientists working for Boeing under contracts at different sites in the Russian Federation and CIS. During his career at Boeing, Kravchenko was instrumental in creating the Boeing Commercial Airplanes raw material procurement program and developing new projects for Commercial Aviation Services in Russia/CIS. In addition, he was the first deputy director of the Boeing Technology and Design Center in Moscow (1992 to 1995) and helped establish the first Boeing office and operations in Russia/CIS. Before Kravchenko joined Boeing in 1992, he worked as a professor and as the lead scientist of the Russian Academy of Sciences. He also taught in Moscow and worked as a research consultant in Europe, the United States and Asia. Kravchenko holds a doctorate degree of engineering science, earned in 1990. He has published more than 50 research papers and holds more than 20 patents in various areas of engineering. In 1988, Kravchenko won the Russian Governmental Youth prize. Kravchenko is a member of Russian Engineering Academy, a member of the American Institute of Aeronautics and Astronautics (AIAA) and honorary doctor of Georgian Technical University. In 2007, Kravchenko was elected as member of the board of directors of the American Chamber of Commerce in Russia. In 2009, the American Chamber of Commerce presented Kravchenko with the Business Person of the Year Award. The award is given to the most successful executive of an American company operating in Russia.

- Sergei Vladimirovich, what is your agenda on Farnborough? Today Boeing presented the forecast of demand for aircraft around the world for the next 20 years, please specify what is in Russia and the CIS?

-  The figures presented today in the updated forecast are striking in their scale. Fifteen trillion dollars is much more than the annual budgets of many countries. This is the volume of sales that we forecast in the field of civil aircraft, civil aviation services. It is very interesting that of these 15 trillion, 6.3 are aircraft, and services - more than 8.8 trillion. We are the first in the production of civil aircraft and are planning to become number one in aviation services. This brings me optimism, because the plans that our chairman and the CEO announced several years ago that the company was going to be the leader in the aerospace sales industry are feasible. Today we sell for more than 110 billion dollars. Our goal is to sell for 200 billion.

As for the number of aircraft, more than 42,700 aircraft will be needed in the next 20 years, of which approximately 1290 will be needed by Russia and the CIS. We do not make a separate forecast for Russia. Traditionally, the main demand in the CIS, almost 70% - are narrow-bodied aircraft. We always sell significantly more than 737, but wide-body aircraft are also in high demand. Recently, Aeroflot bought 16 Boeing 777-300 aircraft, and then ordered another six such aircraft.

Freight aviation is also developing very rapidly. You know, Volga-Dnepr has signed a large number of contracts with us, including a well-known contract for 20 747-8 aircraft. Today, Volga-Dnepr is the largest in Eastern Europe and, perhaps, one of the world's largest operators of 747-8 aircraft.

So, the figures for Russia and the CIS - 1290 aircraft for 20 years, the market capacity of about 150 billion dollars. Approximately 70% of this market is narrow-bodied aircraft.

- The contract for the supply of titanium with VSMPO-Avisma is concluded until 2022. Will it be extended? And do you have plans to increase the volume of purchases?

- We use a lot of Russian titanium in our wide-body aircraft. These are two types of aircraft: 777 and 787. At 787 in raw materials we buy 22 tons for each aircraft from VSMPO. The forecasts of the increase in the volume of purchases are directly related to the forecast of the rates of production of these aircraft. When this contract was concluded, 787 was at the beginning of its production cycle. Then we produced 2 aircraft a month, then 4, then 8, 10 and, finally, 12. Today we are talking about 14 aircraft as a real plane. Here you immediately 20% -40% increase from 10 aircraft per month. To produce the new 777X, a lot of titanium will be used. This is our new aircraft, which is currently undergoing final assembly and will be put into operation in 2020. We still plan that the titanium will be in demand for a new aircraft, which we have not yet launched - the NMA (New Medium-High-Aircraft). The decision to launch this program will be taken in 2019. It seems to me that VSMPO has good prospects, of course, until politics interferes. But while we together with our partners have managed to protect this business well enough.

Of the $ 27 billion that we plan to spend in Russia for 30 years, 18 billion are purchases of titanium. VSMPO-Avisma is a very respected manufacturer. We really like working with him. Since 2009, in Sverdlovsk Region, our joint venture Ural Boeing Manufacturing has been working with VSMPO on roughing titanium parts. But they are not the only producers of good aerospace titanium. There are 2-3 excellent American companies, there are Japanese companies, Chinese companies are actively trying to enter this market now, there is Deutsche Titan.

- You talked about doubling the production of titanium products for Boeing in Russia. At what stage are these plans right now?

- At the final stage. In the coming months you will be just as happy as we are. I confirm that in 2018 we are planning to open a second plant in the Titanium Valley. It will be the most modern titanium products processing plant. It will be more than our first factory. This is due to the fact that we produce more wide-bodied aircraft, in which a lot of titanium is used. This titanium will be supplied for the aircraft 777, 777X, 787. This plant is our joint venture with VSMPO. The joint venture also provides for fulfilment of orders from third parties. This should be by mutual consent of VSMPO-Avisma and Boeing. Many are interested in this, but we have such a big and successful business that we would like to expand these capacities, we ourselves do not have enough.

- Concerning the concept of airspace development over Moscow. What about this program?

- In Moscow despite rather large and serious efforts there isn't the most modern system of air traffic management. Although the Moscow government and the federal authorities have invested a lot of money in the purchase of new equipment. It is necessary to redesign the approach procedures, apply new technologies for air traffic services, the technology of air traffic controllers. And we are ready to do this work with the Moscow aviation hub. We developed several prototypes of the structure of the Moscow nodal dispatching area, these prototypes were very successful. We work very tightly with our partners - both with airlines and airports, but the decision to implement jointly developed prototypes is for the Russian authorities. We are ready, we want to help, we are interested in this.

Our main motivation here is that there should not be "bottlenecks" so that there is no way to stop this fantastic 20% growth that we see in passenger and freight traffic in Russia recently. This is such a big growth that it needs a lot of aircraft, and if there are many aircraft, a much more advanced air traffic control system is needed, because now it works with the old systems almost at the limit. We are very interested in just helping Aeroflot, Sheremetyevo, Domodedovo, Vnukovo take more sides, do it efficiently and very safely. In addition, the implementation of such a joint project will allow the Russian side to significantly increase its competence in the field of air traffic management.

- How successful is your center in Skolkovo?

- I'm very proud of this project for several reasons. First, this is the very first project that the western company has implemented in Skolkovo. We were the first to build this center, and I'm glad that the company did it in such difficult political times. This had been noted by everyone. For me it was very important. Secondly, it is an industrial project, we created the most modern training center for pilots. Russia and the CIS in the next 20 years will need to train 22,000 pilots. In the same building is a research center, where talented Russian scientists, programmers, engineers work together, who develop new technologies together with our experts to improve flight safety, so that we, our loved ones, our children safely flew by aircraft of the future.