Motor Sich to Strengthen Ties to Chinese AVIC-II

According to Interfax, Chinese aircraft manufacturer AVIC-II announced is ready to expand its projects with Ukrainian companies such as Zaporizhya-based Motor Sich (MSICH: BUY) and Ivchenko Progress design bureau, to include the development of new modifications to AVIC-II’s medium-haul cargo airplane, the Y8F600, which is a variant of the Ukrainian An-12. AVIC-II’s CEO said the company plans to visit Zaporizhya to negotiate collaboration terms. Inna Perepelytsya: In 2002, AVIC-II signed an agreement with Pratt & Whitney to install its engines on Y8F600 planes. We can assume that cooperation with Pratt & Whitney could have proven rocky. In any case, we see Motor Sich’s participation in this project as very likely: it already delivers engines for the AVIC-II-built trainer, L-15, as well as has had a supply agreement with Pratt & Whitney since 2007. We are waiting for more information to estimate the possible impact on Motor Sich’s revenues.