Ukraine may postpone financing of An-70 plane development

Ukraine may postpone financing the development of the An-70, a medium-range transport aircraft powered by four Motor Sich (UX: MSICH UK) D-27 engines, Kommersant reported yesterday. According to Ivan Marko, head of the finance department at the Ministry of Defense, Ukraine will not include this project in next year’s budget, focusing instead on social needs for the military. The aircraft is being developed jointly by Russia and Ukraine, with an estimated USD 70 mln to be invested by Russia with USD 60 mln from Ukraine. Yegor Samusenko: We view this news as marginally negative for Motor Sich, the sole producer of engines for this plane. However, development delays are the norm in this business and we still see the An-70 going forward in future and expect the start of serial production by 2015.