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Bell Helicopter Lands Localized Production Deal in Russia

A G-OPEN Bell Helicopter

U.S. helicopter manufacturer Bell is teaming up with Russia's Ural Works of Civil Aviation (UWCA) to cut costs by assembling one of the U.S. firm's production lines' locally, a company statement said Tuesday.

Foreign helicopter firms have struggled to implement localized production deals with Russian manufacturers. According to experts cited by newspaper Kommersant on Monday, every potential project to date has fallen apart during negotiations.

"This is a key milestone for Bell Helicopter that we expect will lead to further opportunities within the Russian market," a Bell press release quoted Patrick Moulay, Bell's vice president of global sales and marketing, as saying.

Under the deal, UWCA agreed to purchase the components for several of Bell's new 407GXP helicopters. The helicopters will be delivered by the end of the year to UWCA's manufacturing center in Yekaterinburg for final assembly.

UWCA head Vadim Badekha said his company could invest up to 500-600 million rubles ($10-12 million) in the Bell production line, and that localized production of the 407GXP could shave 17 percent off the vehicle's $5 million price tag, Kommersant reported Monday.

Though Russia has a strong helicopter industry, it is geared heavily toward medium and large helicopters designed for military use. Western firms such as Bell and France's Airbus dominate the light civilian helicopter market in Russia.

UWCA is part of the state corporation Oboronprom, which is in turn a holding of state-owned defense and technology giant Rostec, which was sanctioned by the United States last year over Moscow's hand in the Ukraine crisis.

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