Bankrupt Fairchild Dornier looks east as it struggles to save regional jet programme

Fairchild Dornier is in talks with Russian industrial group Basic Element over its possible involvement in the 728 regional jet programme.

Engineers from the group, also known as Siberian Aluminium (Sibal), were last week inspecting the 728 production line at Oberpfaffenhofen, Germany.

However, Fairchild Dornier chief executive Thomas Brandt says "there are no negotiations - just talks" at this stage. Brandt is also seeking contacts with Chinese aircraft manufacturers and other Russian companies in a last ditch attempt to save the 728 - although, so far, without success. He adds: "They are the only countries which have the potential to take on this programme."

The Russian group confirms talks are continuing, but declines to provide details. Sibal is understood to have initiated discussions with a view to investing in the US-German company in exchange for rights to build 728 parts in Russia - a move that would help to reduce manufacturing costs.

Russian sources say that Sibal, which controls several aluminium plants in Russia, does not have the financial resources to rescue Fairchild Dornier from bankruptcy, however, having acquired two Russian enterprises over the last couple of years - the Aviacor plant in Samara, which produces the Tupolev Tu-154M, and hydraulic systems specialist Gidroavtomatika. If a deal were struck, 728 parts would be manufactured at Aviacor.

Fairchild Dornier is unlikely to attract interest from other Russian manufacturers, several of which, including Antonov, Sukhoi and Tupolev, are seeking Russian state funding for their own regional jet projects in Rosaviakosmos's new regional jet contest.

Sukhoi, which is partnering Boeing, Ilyushin and Yakovlev in the Russian Regional Jet programme, has discounted any possibility of participating in the 728. Andrei Ilyin, general director of Sukhoi Civil Aircraft, says: "Development of the 728 is almost complete, and so there's no room for us as a design house in the project." He adds: "The project is clearly over-expensive. I don't think you can reduce its costs substantially by making parts in Russia, because these were not designed to be built in this country."

Industry observers estimate that completing the 728 programme would cost between $800 million and $1 billion.

Source: Flight International