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Cablegate: Superjet Readying for Takeoff in Komsomolsk

VZCZCXRO4631
RR RUEHCHI RUEHFK RUEHHM RUEHKSO RUEHLN RUEHNAG RUEHPB RUEHPOD RUEHYG
DE RUEHVK #0031 0860636
ZNR UUUUU ZZH
R 260636Z MAR 08
FM AMCONSUL VLADIVOSTOK
TO RUEHC/SECSTATE WASHDC 0913
INFO RUCPDOC/USDOC WASHDC 0035
RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUEHZU/ASIAN PACIFIC ECONOMIC COOPERATION
RUEHVK/AMCONSUL VLADIVOSTOK 0985

UNCLAS VLADIVOSTOK 000031

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ECON EINV PGOV RS
SUBJECT: SUPERJET READYING FOR TAKEOFF IN KOMSOMOLSK

1. (U) Komsomol'sk-na-Amure is the third largest city in the
Russian Far East and home to the Sukhoi Superjet, a
multinational project that involves Boeing and a half a dozen
other U.S. firms, as well as German and French aviation
companies. At the Sukhoi assembly plant, CG saw one Superjet
that appeared to be almost complete, and another two jets under
construction. Superjet is meant to be a fuel efficient, quiet,
medium range regional jet capable of handling 75-95 passengers.
The jet can be configured for commercial passenger airlines, or
as a luxury business jet with a speed of 780 kilometers per
hour. Most of the customers so far are Russian firms, according
to General Director Sergey Skryabin, but Sukhoi sees a lot of
potential in Asia and hopes to expand rapidly.

2. (U) Skryabin said on March 19 that the first test flight
would be in April, but recent news reports say test flights may
be delayed. Other American firms involved in the Superjet
include Goodrich, Thales, Vibro-meter, Hamilton Sundstrand,
Curtiss Wright, B/E Aerospace and Honeywell. A request for
photos made Skryabin a bit nervous so we had to settle for a
photo of the Superjet on a city billboard for the Consulate
website, but the factory floor looked immaculate and fully up to
international standards.

3. (U) Ironically, for a Mayor with one of the most successful
U.S.-Russian joint ventures in his town, Komsomol'sk Mayor
Vladimir Mikhalyev seemed singularly uninterested in developing
further U.S.-Russian economic ties. The Mayor and his staff met
with CG for 15 minutes, dismissed the idea of a sister city
relationship, and even made sure his aides did not include the
press in the perfunctory meeting. The Mayor, a former engineer,
has 17 years of experience running Komsomol'sk, an industrial
city upriver from Khabarvosk on the Amur River. City population
has dropped from a peak of 300,000 to some 270,000, the majority
employed in the city's aircraft and ship manufacturing plants,
wood processing facilities, and oil and gas refineries. The
Mayor did say that the city has room to expand and plenty of
energy and infrastructure for new firms, as well as a tax free
zone. But so far, foreign firms are concentrated in the
aviation sector. Unemployment is less than two percent, and the
city looks relatively prosperous, clean, and busy. Komsomol'sk
has not requested a quota of Chinese laborers, but the Mayor
admits that the population drain creates a labor shortage that
is a major challenge for the city.

4. (U) CG delivered a lecture on American Diplomacy to some 80
students at the Amurskiy Pedagogical State University. In
contrast to the Mayor, the Rector was extremely welcoming and
eager to expand bilateral contacts. The students spoke English
well and participated in a lively exchange on international
affairs. Four American teachers working at the University for a
month long teaching program also attended, and shared their
experiences living in Komsomol'sk. English remains the number
one foreign language at the University, although Chinese is
gaining fast. As with most Russian Far East universities, few
of the students have been to the U.S., but almost all of them
have been to China. In fact, more have traveled to China than
Moscow because of the expense of air travel between the RFE and
Russia's capital.

5. (U) Comment: Komsomol'sk has many advantages, good
infrastructure, an educated populace, and significant natural
resources, but the somewhat unreconstructed attitude towards
Americans makes it hard to list the city administration as
"business friendly." Still, Boeing and other American companies
have found a way to do business that is mutually beneficial, has
great long term prospects, and that could lead to spin-offs in
other directions. The Mayor may well be open to concrete
American proposals, but it's not likely he will be sending any
trade missions to the U.S. anytime soon.

ARMBRUSTER

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