UTAir sets sights on global growth

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Siberian company sets up in South Africa and plans move into Europe next year on back of rise in demand from UN

Siberian helicopter operator UTAir is establishing a base in South Africa and plans to expand into Europe next year as part of a long-term plan to transform the Surgut-based operation into a global company using Russian-built helicopters.

Expansion plans are prompted by the sharp rise in demand from the United Nations for UTAir helicopter services. The company was recently awarded a contract to provide transport for UN officials in Chad, boosting the value of its UN contracts to $50 million. UTAir operates six Mil Mi-26s, 19 Mi-8MTVs and three Mi-8Ts on behalf of the UN out of a fleet of 184 helicopters and 117 fixed-wing aircraft, with one-third of its activities being helicopter work.

UTAir is operating in South Africa under its own name, but is working towards certification for UTAir South Africa from the local authorities. Two Mi-8T helicopters are flying in the country in a firefighting role under a government contract. UTAir is establishing a helicopter maintenance base in South Africa to support its own aircraft as well as Mi-8/17 series helicopters operating in the region.

"About 200 such helicopters are operational there. We intend to provide maintenance and crew training services for operators," UTAir general director Andrei Martirosov says. "This region is very promising, showing a high demand for services."

The second phase of the company's global expansion will see it establishing a European company in 2005 to operate Mi-26TS and Mi-172 helicopters and later new Russian types under European certification. Martirosov forecasts a relatively small European market for the 20,000kg (44,000lb) payload Mi-26, but believes the market potential for the helicopter has not been fully exploited.

UTAir is negotiating with Russian banks a loan for helicopter purchases worth $20 million to supplement its growing international operations. "This year and the next shall be decisive for us. We are set to be very active in penetrating non-UN markets internationally," says Martirosov. "It will not be easy to establish a business in Europe as nobody knows us there, and the market is very conservative," he adds.

Martirosov is confident, however, that there will be a demand for its services in Europe due to the performance of the Russian heavy- and medium-weight helicopters - which Martirosov says are superior to European and US designs.

In the lightweight helicopter segment, UTAir has an immediate need for 15 Kazan Ansat light twins, and hopes to take the first aircraft in 2005. The operator is also considering leasing lightweight Western helicopters.

Vladimir Karnozov / Surgut, Siberia