Soviets Miss Absence at Show of Best in U.S.
At AIR/SPACE America 88, the designer of the deadly Mi-24 Hind attack helicopter rubbed shoulders with the makers of the Stinger surface-to-air missile, the General Dynamics product that helped force the Soviet withdrawal from Afghanistan. International trade, like politics, makes strange bedfellows.
But, at Brown Field last week, the Soviets had to sleep alone most of the time.
For 11 days in May, the air show was host to what promoters described as the largest Soviet trade delegation ever to visit the United States. The group of about 60 Soviet civilian and military department heads, businessmen, engineers, flight and ground crews and other functionaries was led by A. N. Gerashchenko, first deputy minister of the aviation industry of the U.S.S.R.
The second-ranking member was Pyotr V. Balabuev, general designer of the Antonov transport aircraft design bureau, which engineered the world’s largest plane, the An-124 Ruslan.
No. 3 was Marat N. Tishchenko, general designer of the Mil helicopter and creator of the Hind gunship. Balabuev was here to show off Ruslan and Tishchenko to show off the prototype of Mi-34, a new sport helicopter.
Technical Achievements
The Soviets said they came to the show to meet American aviation experts and engineers and to see the latest aircraft as well as to show off their technical achievements.
But, the wry Tishchenko said, “I came to meet my colleagues from America, but have had no interesting discussions and have not seen any helicopter people.”
Balabuev voiced a common refrain among his compatriots. “We wanted to see more modern companies--Lockheed, Douglas, Boeing, also GE and other engine companies. We ask, ‘Why did they not participate?’ The people who arranged the show should have done better. They lacked show expertise.”
Tishchenko bemoaned the absence of U.S. helicopter manufacturers Bell and Sikorsky.
Anatoli G. Bulanenko, deputy chief designer at Antonov, has taken Ruslan not only to the Paris and Farnsborough air shows, but to Abbotsford, B.C., and Singapore. He commented, “This is a small show. Smaller than Abbotsford. Smaller than Singapore. Here are only amateur things (private planes) and Air Force. We are disappointed, particularly with lack of U.S. companies, but also Europeans. Our people see a lot of shows. We look at this as beginning in organization and experience.”
A. M. Bathov, a department head at the Ministry of Aviation Industry, recalled that “the program had much more airplanes in beginning. We would have been glad to see Boeing’s prototype airliner 7J7 here. It was promised earlier.”
The Soviets agreed to attend AIR/SPACE America 88 before its organizers’ hopes for a long row of corporate chalets were buried under an avalanche of regrets from firms unable to make it. So the Russians’ disappointment is not unreasonable.
Important to Make Start
Asked if he felt cheated, Bathov said, “ Nyet . We look at things in reality. Advertising is advertising. We appreciate your inner difficulties. Maybe you need to make perestroika , too.”
He chuckled and turned charitable. “We know that hosts and press are disappointed too with level of airplanes. It is very important to (make a) start. If our participation can make show bigger later on, then we will be happy.”
International trade shows serve several purposes for the Soviets that are less important or non-existent for the United States. Russian engineers don’t often get to meet foreign colleagues. Espionage, both industrial and military, remains relatively more important for Soviet than for Western exhibitors. The Soviets’ emphasis at air shows until recently was more on displaying technical achievements for prestige purposes than on wheeling and dealing for dollars and other hard currencies.
U.S. for-profit companies have found international aviation trade shows less useful than have state-owned Russian enterprises or, for that matter, semi-private European firms. Some major American aerospace corporations don’t attend the prestigious Paris and Farnborough shows, so it is not too surprising they sat out this new, smaller affair. But, although Lockheed and Northrop stay home from Paris, McDonnell Douglas and Boeing do go there.
Trade Follows Flag
Prestige, personal contacts and collecting information are strong motives for the Russians. They probably would have attended AIR/SPACE America even had they known that many major U.S. airframe and engine manufacturers wouldn’t be there. But, these days, Russians come to shows ready to play Let’s Make a Deal. Bulanenko summed up the new attitude: “We are here to show and to get sales or contracts for cargo.”
The U.S.S.R. has been selling aircraft abroad for decades, but the transfers often amounted to dumping. As with previous empires, Soviet trade largely follows the flag. Even in deals with non-client states--Peru for instance--profits were frequently secondary to political penetration. Customers got products at cut-rate prices, but later complained about follow-up support, especially lack of spare parts. It remains to be seen whether perestroika will extend to post-purchase support.
The new element evident at AIR/SPACE America 88 was an appreciation of marketing. This used to be easy for the U.S.S.R.-- just underbid the competition. But Gorbachev-era Russian businessmen sometimes sound like Cal Worthington. It’s not always clear when they are joking.
Asked whether Antonov would like to sell Ruslans in the U.S., Bulanenko beamed and replied, “If you give us some money for the plane now, you can take it and we will fly home with Pan Am.”
Asked how much a single An-124 would cost an American customer, Balabuev answered, “Less than C-5B.” The C-5 Galaxy is the U.S. Air Force’s largest transport.
How much for a lot of three? Smiling, Balabuev offered a 30% bulk discount.
“We are studying your marketing techniques,” he added with a bigger grin.
Balabuev’s offer to beat Lockheed’s price for C-5B was serious. “If the American President would like to buy this airplane, we will gladly sell.” Even as sophisticated a businessman as the general designer apparently failed to understand the role of Congress in U.S. government procurement. California members of Congress, having fought so tough a battle with Henry Jackson to win approval of C-5B over a modified 747, are unlikely to welcome a Russian competitor, no matter how good a deal he offers.
Negotiating With British
Two other Soviet transport aircraft lines--Ilyushin and Tupolev--were also represented at the show. Their engineers don’t seem too optimistic about breaking into the U.S. market, but their latest airliners are built to Western standards. There have been negotiations with the Dutch and sales to mainland China. Mil is negotiating a deal with Bristol to supply the British firm with Mi-26 heavy lift helicopters for use in the North Sea oil fields.
Ilyushin engineer N. D. Talikov said his bureau has “tried to put in all the technology available to increase the number of passengers and improve efficiency.” He claimed these advances--composite materials, improved engines, electronic flight control--are “immediately introduced, but, just like you, we are starting to count money.”
Western companies are trying to enter the market for airliners in the East Bloc. Bathov said, “We don’t have any objections. Competition always helps to develop better products. We will do our best so our planes do best.” Despite this ringing endorsement of free trade, he referred to Eastern Europe as “our market.”
On Thursday, 10 somewhat less-disappointed Soviets flew up to Seattle to meet with Boeing personnel. On Sunday, Talikov said: “After many years of coldness between our two industries, we got acquainted with the Boeing company in general. Nothing concrete was decided. We both just showed some interest for close cooperation of different forms and agreed to meet in Moscow (to discuss areas of potential) mutual cooperation. In some fields we are strong, and there are some where you are stronger. This interest could lead to further contacts.”
The last time a Soviet delegation visited Seattle, its members reportedly wore magnetic shoes to pick up alloy samples off a factory floor. Instead of buying Boeing planes, as their hosts naively hoped, the Russians, according to industry lore, used their metallic samples to reverse-engineer a new generation of airliners.
Plenty of Suspicions
The contacts made at last week’s air show may constitute a new beginning or new, subtler subterfuge. There were plenty of suspicions on both sides at Brown Field, but also reason to hope for productive future cooperation. In a winning instance of glasnost , Balabuev stated his belief that provisions for crew comfort in Soviet long-range transports were “shameful.” Nevertheless, he feels Ruslan is superior overall to C-5B, elements of which he considers unnecessarily complicated.
Despite certain disappointments, the U.S.S.R. plans to attend AIR/SPACE America 90. Talikov’s new wide-body airliner, Il-96, will fly part of the delegation here. Its first test flight is scheduled next month. In 1990, passengers will be offered rides, but may not receive champagne and caviar, like the $985-service on Concorde this year.
If mutually satisfying and fruitful trade with the U.S.S.R. is in U.S. security and economic interests, as seems likely, then American companies may have to quit playing hard to get and flirt a little instead.
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