Known for the production of both military and civil aircraft, including the Tu-160 bomber and the Tu-214 passenger jet, the Kazan Aviation Plant (KAZ) is an essential part of Russia’s aircraft manufacturing industry. KAZ’s independent legal status ended in 2014, and it was reclassified as a branch of the Tupolev Design Bureau, which is a subsidiary of the United Aircraft Corporation (UAC). It was the intention of this action to simplify the coordination between design and production; however, recent developments indicate that the integration has not yielded the anticipated result.
Vadim Badekha, the General Director of UAC, and Alexander Bobryshev, the Managing Director of Tupolev, recently visited Kazan to explore the feasibility of splitting KAZ from the Tupolev design bureau. This visit coincides with broader management changes at UAC, which have resulted in the replacement of the leadership of both Yakovlev and Tupolev to enhance program management and expedite critical projects. The primary objective of the proposed separation is to enhance accountability and efficiency, as the current arrangement has resulted in production challenges and missed deadlines, particularly with the Tu-214 program.
One of the main worries is that KAZ is experiencing difficulty in meeting the delivery targets for the Tu-214, despite being a revenue-generating manufacturing facility. The Russian government had ambitious plans to increase the production of the Tu-214, with the goal of delivering over one hundred units by 2030. However, it is anticipated that only one or two aircraft will be delivered in 2025. The plant’s ongoing modernization, labor shortages, and supply chain disruptions are all contributing factors to this deficit. Simultaneously, Tupolev’s design bureau has not secured any new development contracts, which presents a financial and operational challenge in terms of managing both design and production under a single umbrella.
The proposed separation has the potential to result in substantial organizational modifications. UAC is contemplating a structure in which production and design are administered as separate divisions. Rather than regaining full legal independence, KAZ may become a component of a larger UAC production complex. This change would diminish the design bureau’s influence over manufacturing and enable UAC to exercise more direct oversight. This action is perceived as a reaction to the more general trend in the Russian aviation industry, which is to centralize production to enhance efficiency and elucidate responsibilities.
KAZ continues to encounter obstacles in spite of these organizational changes. The plant’s capacity to increase output is restricted by a scarcity of qualified workers, which is the most pressing issue. Additionally, Western sanctions have forced Russian manufacturers to replace imported components, complicating assembly and requiring recertification of parts. KAZ is currently in the process of a significant modernization program, with the completion of new facilities and equipment anticipated by 2026. However, significant production increases will only be feasible once these upgrades are complete and staffing issues are resolved.
Since the Soviet Union’s collapse, the Russian aviation industry has experienced many cases of extensive restructuring and separation. To respond to evolving economic realities, optimize efficiency, and clarify management, the Russian government has repeatedly reorganized and consolidated design bureaus and manufacturing facilities.
One example that is particularly noteworthy is the establishment of the United Aircraft Corporation (UAC) in 2006. This was a significant consolidation that unified Russia’s chief aircraft design bureaus and manufacturing entities, such as Ilyushin, Irkut, Mikoyan (MiG), Sukhoi, Tupolev, and Yakovlev, under a singular corporate structure. The objective was to centralize management, optimize production, and reduce losses, a strategy that is currently being considered in conjunction with the separation of KAZ from Tupolev and the establishment of separate production and design divisions within UAC.
In the 1990s, there were efforts to reorganize the MiG design bureau and its associated factories. MiG was reorganized as a subsidiary of the Moscow Aircraft Production Association (MAPO), a larger organization that comprised approximately 20 aviation factories. The purpose of this integration was to enhance the integration of design and production; however, the industry underwent additional reorganizations as it adjusted to market pressures and government policy changes.
Another example is the Saratov Aviation Plant (SAP), which was initially a manufacturer for the Yakovlev Design Bureau. SAP transitioned from military to civilian production, underwent privatization, and ultimately became a joint-stock corporation owned by its employees. Decentralizing management, spinning off subsidiaries for specialized activities, and segregating financial and product responsibility at the division level were all components of this process.
In conclusion, the potential separation of KAZ from Tupolev is indicative of the significant operational and structural challenges that Russia’s civil aircraft industry is currently encountering. The objective of UAC’s endeavors to centralize control and demonstrate accountability is to address these obstacles and achieve its ambitious production objectives. Nevertheless, it will be challenging to secure the intended production increases until the completion of modernization and the resolution of issues such as labor shortages and supply chain disruptions. Additional changes within UAC may also be indicated by this restructuring, which may indicate a developing division between design and manufacturing operations.
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