Aeroflot Group has released its consolidated financial results for the first six months of 2025, prepared in accordance with International Financial Reporting Standards (IFRS). The Russian airline reported a net profit of RUB 74.3 billion (approximately USD 800 million), a 75.7% increase compared to the same period in 2024.The group's total revenue reached RUB 414.8 billion, representing a 10.0% year-over-year growth. This increase was primarily driven by an 11.3% rise in revenue from scheduled passenger flights, which amounted to RUB 388.6 billion.Operationally, Aeroflot carried 25.9 million passengers during the first half of the year, up 2.0% from the previous year. Domestic traffic grew by 1.3%, while international routes saw a 4.1% increase. The average load factor stood at a strong 89.1%, an improvement of 0.8 percentage points.<figure class="table"><table><thead><tr><th>Operational Indicator</th><th>H1 2025</th><th>H1 2024</th><th>Change</th></tr></thead><tbody><tr><td>Passengers Carried</td><td>25.9 million</td><td>25.4 million</td><td>+2.0%</td></tr><tr><td>Revenue Passenger Kilometres (RPK)</td><td>71,062 million</td><td>68,548 million</td><td>+3.7%</td></tr><tr><td>Load Factor</td><td>89.1%</td><td>88.3%</td><td>+0.8 p.p.</td></tr></tbody></table></figure>Andrei Chikhanchin, Aeroflot's Deputy CEO for Commerce and Finance, commented that while the group met its operational targets, it faced challenges in its cost structure. He noted a continued rise in passenger service expenses due to airport fees and an increase in labor costs following salary enhancements approved last year.<h3>Financial Analysis and Challenges</h3>Despite revenue growth, the group's operating costs (excluding other income/expenses) increased by 14.3%, outpacing revenue growth. The largest impact came from aircraft maintenance expenses, which soared by 66.6% to RUB 31.6 billion, mainly due to a change in the classification of spare parts and the rising cost of components.&nbsp;<figure class="table"><table><thead><tr><th>Financial Indicator</th><th>H1 2025</th><th>H1 2024</th><th>Change</th></tr></thead><tbody><tr><td>Total Revenue</td><td>414,781</td><td>377,215</td><td>+10.0%</td></tr><tr><td>EBITDA</td><td>141,464</td><td>125,948</td><td>+12.3%</td></tr><tr><td>Adjusted EBITDA</td><td>82,760</td><td>117,189</td><td>-29.4%</td></tr><tr><td>Net Profit</td><td>74,314</td><td>42,287</td><td>+75.7%</td></tr><tr><td>Adjusted Net Profit</td><td>4,301</td><td>27,025</td><td>-84.1%</td></tr></tbody></table></figure>(Financial figures in millions of RUB)Labor costs also saw a sharp 35.3% increase, totaling RUB 58 billion, as a result of salary improvements for pilots, cabin crew, and engineering staff implemented since late 2024.A key point highlighted in the report, according to a press release from Aeroflot, was the behavior of fuel costs. While the price per ton of kerosene slightly decreased, the company received lower government compensations (the "damper" mechanism) due to the strengthening ruble, which raised the effective fuel expenditure by 19.5%.<h3>One-Off Factors and Debt</h3>The bottom line was significantly influenced by two extraordinary factors. On one hand, the company recorded an income of RUB 42.9 billion from the insurance settlement for 17 aircraft. On the other hand, it registered a gain of RUB 34.2 billion from the revaluation of its lease liabilities due to the appreciation of the ruble.Excluding these and other non-recurring effects, the adjusted net profit for the first half of 2025 was RUB 4.3 billion, a figure considerably lower than the RUB 27 billion in adjusted profit recorded for the same period in 2024.Aeroflot Group's net debt decreased by 20.4% since the end of 2024, standing at RUB 476 billion as of June 30, 2025.

Aeroflot's Profit Soars, But a Multi-Billion Ruble Insurance Deal Is the Key Story

The founder of the Russian air cargo giant, Volga-Dnepr Group, Alexey Isaykin, has announced to employees the high probability of the company being transferred to state control in the near future. The statement comes amid operational difficulties due to international sanctions and a growing government interest in its strategic capabilities.According to the Russian newspaper <a href="https://www.kommersant.ru/doc/7988696?from=glavnoe_5">Kommersant</a>, Isaykin made the announcement during the company's 35th-anniversary celebration in Ulyanovsk. In response to questions about recent audits and searches at the company's offices, the founder acknowledged that the group holds "interest for those who need its services" and that this interest is being shown "taking into account the specifics of the current moment.""If the motherland says the company must go to serve the motherland, then that's it: nationalization, confiscation, a fair deal, any form...," Isaykin stated, highlighting the inevitability of the decision if required by the state. Sources cited by the Russian media outlet suggest that the transfer of all assets, including MRO (Maintenance, Repair, and Operations) centers, could be finalized in the coming months.Volga-Dnepr's value primarily lies in its unique fleet, which includes Antonov An-124 "Ruslan" heavy transport aircraft and several Ilyushin Il-76s. These assets are of particular interest to the Russian Ministry of Defence, which has previously collaborated with the airline for the rapid deployment of equipment and logistical support to remote military bases.Crisis and Strategic RealignmentBefore the sanctions imposed in 2022, the Volga-Dnepr Group was a dominant player in the global market for unique and oversized air cargo. The company generated most of its revenue from international operations, working with major energy, aerospace, and even NATO-related contracts.However, a great part of its fleet was grounded by the subsequent restrictions, which nullified its main competitive advantage. Its subsidiaries, AirBridgeCargo and Atran, are also reporting losses. Current operations are limited to a small number of routes to countries friendly to Russia.The Fleet's FutureExperts quoted by Kommersant, such as Oleg Panteleev, executive director of the Aviaport consultancy, note that while the company's commercial value was "nullified" by the sanctions, Volga-Dnepr still possesses a highly skilled team, a fleet of aircraft, and, crucially, a large inventory of spare parts that allows the An-124s to remain operational.For the Russian Ministry of Defence, the "Ruslans" remain an irreplaceable tool. Although some analysts suggest that operating these aircraft may be unprofitable in a purely commercial context, their strategic value to the state is undeniable. With proper maintenance, it is estimated that the An-124s could continue flying until the 2050 horizon.

Russian Government Poised to Take Control of Volga-Dnepr's Strategic An-124 Fleet

The Russian aviation industry, heavily squeezed by international sanctions and complex domestic monetary policies, is navigating one of its most acute crises. As of August 2025, the country has delivered only one of the 15 commercial aircraft planned for the year, a direct reflection of the challenges in establishing a self-sufficient manufacturing base, as confirmed by Reuters reports.<section class="noteSuggested" data-id="37277" data-title="Puede interesarte"></section>Since the onset of hostilities in Ukraine in February 2022, Western sanctions have blocked Russia's access to foreign-made aircraft and, critically, spare parts. This has placed local airlines in a precarious position, as their fleet of over 700 aircraft is predominantly composed of Airbus and Boeing models. To keep them operational, they are resorting to complex and opaque indirect import routes.The challenge of creating an industry from scratch is monumental. An industry source warned that "there is no component base, technology, production facilities, or engineers. Creating all of this from scratch takes years, if not decades." For a nation spanning eleven time zones, the reliance on air transport to connect its vast territory is absolute.<blockquote>&nbsp;<h3>Key Points: The Russian Aviation Crisis</h3>&nbsp;What is the current state of the Russian aviation industry? It is in a deep crisis, with massive delays and minimal output due to sanctions.Which aircraft is Russia trying to produce? Mainly the SJ-100, MC-21, Tu-214, and IL-114, all with domestic components.Why are the new Russian aircraft delayed? Replacing Western components with local alternatives has resulted in technical issues, such as increased weight and lower efficiency, alongside production bottlenecks.</blockquote>Production figures highlight the steep decline. In 2021, before the conflict escalated, Russia added 52 commercial aircraft, including 27 Airbus, 3 Boeing, and 22 Sukhoi Superjets that still featured a high proportion of imported parts. Since then, the number has plummeted to just 13 aircraft: 12 Superjets and one Tupolev Tu-214, used by the government.Production targets for the 2024-2025 period, initially set at 171 aircraft, were slashed in June to just 21 units. A further downward revision was announced last month, citing financing costs and a sluggish supply chain.Rostec, the state-owned conglomerate managing the Superjet-100 (SJ-100), Tu-214, Ilyushin Il-114, and the highly anticipated Irkut MC-21 programs, is accumulating delays. The MC-21, once touted as an A320 and 737 competitor and now built entirely with Russian parts, has turned out heavier, with a shorter range and lower efficiency than projected. This has dampened interest from airlines. The serial production of the MC-21, as well as the SJ-100 with domestic PD-8 engines and the IL-114 turboprop, has been officially postponed to 2026, two years behind schedule.Despite import substitution efforts, Russia remains dependent on external suppliers. Customs data from 2024 revealed that parts worth at least $300,000 entered the country through intermediaries in Turkey, China, Kyrgyzstan, and the United Arab Emirates. Identified components included parts from Safran (France), Honeywell (USA), and Rolls-Royce (UK). These companies assert they are complying with sanctions and have control programs in place to prevent the diversion of their products.Minister of Industry and Trade, Anton Alikhanov, described the challenge as "unique and hyper-complex," stressing that "no other country in the world produces aircraft with completely domestically substituted imports."This supply contraction, coupled with sustained demand, has led to a steady increase in airfare prices throughout 2023 and 2024, according to data from Rosstat. The situation has become so dire that Moscow has resorted to using airlines from Kazakhstan and Uzbekistan to operate domestic routes, a clear sign of the difficulties Russian aviation faces in staying airborne.

Industrial Collapse: Crippled by Sanctions, Russia’s Aviation Industry Produces Only One Commercial Aircraft in 2025

Russia's flag carrier, Aeroflot, is facing a severe operational crisis this Monday after suffering a far-reaching cyberattack that brought down its IT infrastructure. The incident forced the company to cancel over 40 flights and delay at least a dozen more, causing chaos at airports across the country, including its main hub at Moscow-Sheremetyevo (SVO).Responsibility for the attack was claimed by a hacktivist group calling itself Silent Crow, which stated it acted in concert with the Belarusian group Cyberpartisans BY. In a statement whose authenticity is being analyzed, the attackers directly linked their actions to the war in Ukraine. "Glory to Ukraine! Long live Belarus!" concluded the group's message, which, according to <a href="https://www.google.com/search?q=https://www.reuters.com/technology/russias-aeroflot-cancels-flights-after-pro-ukrainian-hackers-claim-massive-2025-07-28/">Reuters</a>, has a history of attacks against other Russian entities.The hackers claim the operation was the result of a year-long effort to infiltrate Aeroflot's network, asserting they have destroyed 7,000 servers and gained control over employee computers, including those of senior managers. Furthermore, they issued a serious threat: the imminent release of "the personal data of all Russians who have ever flown Aeroflot."<blockquote>What You Need to KnowWhat happened? A massive cyberattack affected Aeroflot's reservation, dispatch, and operational systems.Who is behind it? A pro-Ukrainian hacker group called Silent Crow, in collaboration with Cyberpartisans BY.What is the immediate impact? Over 40 flights were canceled and numerous delays occurred, primarily on domestic routes but also to Minsk (Belarus) and Yerevan (Armenia).What is the Russian government saying? The Kremlin deems it "alarming," and the prosecutor's office has opened a criminal investigation.</blockquote>The impact on passengers was immediate. Stranded travelers at airports like Volgograd voiced their frustration on social media regarding the lack of information and continuous schedule changes. The airline's website and mobile app became inaccessible, preventing customers from managing their bookings or requesting refunds. Aeroflot stated it is working to mitigate the impact and restore normal operations, offering refunds or rebookings once its systems are back online.The Russian government's reaction was swift. Kremlin spokesman Dmitry Peskov described the situation as "quite alarming" and acknowledged the persistent threat hackers pose to large service companies. Meanwhile, lawmaker Anton Gorelkin, a key figure in Russia's digital policy, declared that "the war against our country is being waged on all fronts, including the digital one," suggesting the hacktivists could be in the service of "unfriendly states." The Prosecutor General's Office of Russia confirmed the incident was the result of a hack and has already launched a criminal investigation.This event highlights the vulnerability of Russia's digital infrastructure, particularly in a sector like aviation, which has been operating under heavy international sanctions since 2022. Despite these restrictions, Aeroflot carried 55.3 million passengers last year, remaining one of the world's top 20 airlines by volume.

Cyberattack on Aeroflot: What Happened, Who Is Behind It, and How It Affects You If You're Traveling in Russia

An Antonov An-24RV passenger plane belonging to the Russian airline Angara Airlines crashed this Thursday in a mountainous area of the Amur region, in the Russian Far East. The wreckage of the aircraft was located about 15 kilometers from the airport in the city of Tynda, its final destination. According to preliminary reports from emergency services, none of the 49 occupants survived the impact.The aircraft, with almost 50 years of service, was flying a domestic route that originated in Khabarovsk, with a stopover in Blagoveshchensk, before heading to Tynda.<div class="raw-html-embed"><iframe src="https://www.google.com/maps/embed?pb=!1m18!1m12!1m3!1d42800.399001741804!2d124.7079160909411!3d55.151475353148776!2m3!1f0!2f0!3f0!3m2!1i1024!2i768!4f13.1!3m3!1m2!1s0x5c2117c3fe7d7b2b%3A0xae18d4bb2c34e795!2sTynda%2C%20%C3%93blast%20de%20Amur%2C%20Rusia!5e1!3m2!1ses-419!2sar!4v1753353419001!5m2!1ses-419!2sar" width="600" height="450" style="border:0;" allowfullscreen="" loading="lazy" referrerpolicy="no-referrer-when-downgrade"></iframe></div>Communication with the crew was lost as the aircraft was making a second approach attempt to the airport in low visibility conditions, according to the Russian news agency Interfax.The governor of the Amur region, Vasily Orlov, confirmed that 43 passengers, including five children, and six crew members were on board.A Mi-8 helicopter from the rescue teams located the burning wreckage of the An-24 on a mountainside, in an area of dense forest and difficult access, which complicates recovery efforts.<div class="raw-html-embed"><iframe width="315" height="560" src="https://www.youtube.com/embed/oRRacB5wzFM" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen=""></iframe></div>Angara Airlines operates a fleet of 31 aircraft with an average age of 41 years:<ul><li>12 Antonov An-24RV</li><li>3 Antonov An-26 100</li><li>12 Mi-8 T helicopters</li><li>3 Mi-8 AMT helicopters</li><li>One Mi-8 AMT helicopter</li></ul>From its base at Irkutsk International Airport, it serves a network of five destinations in the Amur region.The Antonov An-24 is a Soviet-era turboprop of which 1,300 aircraft were built between 1959 and 1979.&nbsp;According to data obtained by Aviacionline through <a href="https://www.cirium.com">Cirium Fleet Analyzer</a>, there are currently 77 Antonov An-24s in service, the vast majority with Russian airlines, with only a dozen distributed among North Korea, Cuba, Yemen, Kazakhstan, Somalia, and Ukraine.

Angara Airlines An-24 crash in Russia: What we know

Dubai Aerospace Enterprise (DAE) announced it has received approximately $282 million in additional cash proceeds from settlements reached with a select group of insurance and surety companies.These funds relate to claims filed by DAE concerning aircraft it had leased to airlines in the Russian Federation. With this latest amount, DAE’s total recovery through various settlement agreements—including those announced in 2023 and 2024—now stands at $601 million.As part of the recent agreements, DAE and its relevant affiliates withdrew their claims against the specific insurers and reinsurers involved in the settlements.The dispute stems from international sanctions imposed on Russia following its 2022 invasion of Ukraine. These sanctions required lessors like DAE to terminate lease contracts with Russian airlines. However, Russia blocked the recovery of foreign-owned aircraft operating within its borders, prompting lessors to pursue claims against their insurers. The disagreements over these claims have led to high-stakes litigation.<h3>London Calling: The main trial is far from over</h3>Despite this compensation, DAE noted that the broader dispute is far from resolved. The company stated it will “continue to actively pursue litigation in the English courts under its own insurance policies,” indicating that claims against other groups of insurers remain ongoing. English courts are a common venue for resolving international insurance disputes of this nature.DAE also said it would “continue efforts to mitigate its losses” related to the aircraft it has been unable to repossess.The $601 million recovered to date represents only a fraction of the total value DAE aims to reclaim through ongoing proceedings. The aircraft leasing industry at large is still managing the financial fallout from these Russia-related events.

A Dubai lessor received 282 million dollars for the aircraft lost in Russia

Russia will need to manufacture at least 200 aircraft to replace foreign-made models that will be withdrawn from service, said Sergei Chemezov, head of Rostec, during the Russian Union of Industrialists and Entrepreneurs (RSPP) Congress, according to Russian news agency Interfax.<h3>Potential for Increased Demand</h3>"We still cannot define an exact number, as we are only beginning talks with airlines. But I believe that at least 200 aircraft will be needed to replace the foreign-made planes currently in operation," Chemezov stated. He emphasized that the final number could be revised and expanded based on the sector's needs.This revision is being considered within the framework of the Integrated Civil Aviation Development Program (KPGA), which has already undergone adjustments due to changes in the global scenario. Initially, the program aimed to produce 994 civil aircraft by 2030, including 592 UAC aircraft, such as the Superjet 100 (SJ-100), MC-21, Ilyushin Il-114-300, Tupolev Tu-214, and Ilyushin Il-96-300, reported our partner outlet, <a href="https://aeroin.net/russia-precisara-de-ao-menos-200-jatos-comerciais-para-atender-a-demanda-ate-o-final-da-decada/">Aeroin</a>.<h3>Target Revision Scheduled for 2025</h3>Chemezov reminded that the KPGA was formulated in 2022, during a period of uncertainty due to the international sanctions imposed on Russia. At that time, there was no clarity on the future of the country's commercial aviation sector, the impact of sanctions on the supply of foreign aircraft, and the availability of spare parts, which required emergency actions.Russian First Deputy Prime Minister, Denis Manturov, had previously stated in September that plans for the production of commercial aircraft in the country would be revised in 2025 as the certification process nears completion.

Russia Will Need to Manufacture at Least 200 Aircraft to Replace Foreign Models

The Superjet SJ-100, a Russian-developed regional aircraft, will undergo a major replacement of imported components with domestically produced parts by the end of 2027, according to Vesti Podmoskovya. This initiative aims to reduce reliance on foreign suppliers and strengthen Russia’s domestic aerospace industry.The project, funded by the federal budget, has an initial contract worth 27.6 billion rubles. The supplier for this large-scale overhaul will be selected after March 13.<h3>Superjet SJ-100: Development and Production</h3>Originally launched in 2000, the Superjet SJ-100 conducted its first test flights in 2008 and delivered its first unit to Armenia’s Armavia airline in 2011. Since then, over 230 aircraft have been produced.<section class="noteSuggested" data-id="36168" data-title="You might be interested"></section><h3>Shift to Domestic Components Amid Sanctions</h3>The decision to replace imported parts was driven by international sanctions, which significantly impacted Superjet production. Initially, many of the aircraft’s components were sourced from foreign manufacturers. However, since 2019, Russian engineers have been working on a gradual transition to locally produced alternatives.According to <a href="https://aeroin.net/aviao-regional-sj-100-recebera-componentes-russos-em-contrato-de-bilhoes-de-rublos/">Aeroin</a>, the urgency to accelerate this transition intensified in 2022 following Russia’s invasion of Ukraine and the ensuing Western sanctions. These restrictions have further pushed Russia’s aerospace industry toward technological self-sufficiency.

Russia’s Superjet SJ-100 to Fully Replace Imported Components by 2027

The United Engine Corporation (UEC) has begun supplying serially produced PD-14 engines for the Yakovlev MC-21 program. These engines, designed for the MC-21-310 variant, represent a significant advancement in Russia's aerospace industry.According to <a href="https://aeroin.net/estatal-russa-inicia-entregas-de-motores-pd-14-para-o-programa-mc-21/">Aeroin</a>, a partner media outlet, Rostec, the state-owned corporation, states that the PD-14 features advanced technologies, including hollow titanium blades and 16 key innovations in materials, coatings, and design.An initial batch of these engines is being delivered for installation on MC-21 aircraft. The company emphasized that the PD-14 is the first turbofan engine of its kind developed in Russia in the modern era.<h2>A Domestic Alternative to the PW1400G</h2>The PD-14 was conceived as an alternative to the Pratt &amp; Whitney PW1400G, which was originally intended for the MC-21-300 version. However, international sanctions restricted the use of the PW1400G, prompting the need for a domestic solution.In response, Yakovlev is adapting the MC-21-310 to integrate more Russian-made components, aligning with the country's import substitution policy.Additionally, the company is working on building a parts inventory to streamline serial production once testing is completed.<h2>Accelerated Development Timeline</h2>Rostec noted that, due to tight schedules, the mass production of aircraft, the development of onboard systems and components, and the test flights of prototypes are all being carried out simultaneously.

United Engine Corporation Begins Serial Production of PD-14 Engines for Yakovlev MC-21

At NAIS 2025, Russia’s National Aviation Infrastructure Forum, held this week in Moscow, Rosaviatsia head Dmitry Yadrov announced that passenger traffic for Russian airlines is projected to decrease by 1.7% in 2025."For this year, Rosaviatsia and the Ministry of Transport have set the target at approximately 109.7 million passengers," Yadrov stated, according to Interfax.This forecast marks a decline compared to the 5.8% growth recorded in Russia’s air transport sector in 2024, driven by a 20.1% increase in international traffic (27 million passengers) and a 2% rise in domestic travel (84.6 million passengers).<h3>Challenges Ahead: Aircraft Shortages and Sanctions</h3>According to Interfax, experts from the State Research Institute of Civil Aviation had previously predicted that air traffic in 2025 could drop to 95.1 million passengers, with a further decline to 91.2 million in 2026. The primary cause is the shortage of aircraft in Russian airline fleets, severely affected by Western sanctions—a challenge compounded by broader issues in the global aviation industry.

Russian Air Passenger Traffic Expected to Decline by 1.7% in 2025

Aeroflot CEO Sergei Aleksandrovsky shared the airline’s 2024 milestones and 2025 objectives in an interview with Russia 24. Over the past year, Aeroflot expanded its international network with new routes, including Denpasar (Bali), and enhanced its flight program to Hainan from multiple Russian regions.<h3>Network Expansion and Passenger Growth</h3>On the domestic front, the airline introduced flights to Elista, Cheboksary, Ulan-Ude, and additional routes from Krasnoyarsk, while increasing transit flights to the Russian Far East. Looking ahead to 2025, Aeroflot plans to launch a new route to Nha Trang (Vietnam) in March, along with flights to Hainan from Kazan, Ufa, and St. Petersburg.Through its Aeroflot Shuttle program, the airline boosted passenger traffic at Pulkovo Airport by 5.2%, reaching 11.2 million travelers. At its main hub, Sheremetyevo, Aeroflot transported 36.8 million passengers— a 19% increase from 2023— achieving record load factors of 90% in the Russian market.<h3>Financial Performance and Employee Compensation</h3>In response to market trends, Aeroflot adjusted its salary policies, increasing average wages for key employee categories by 32%. This salary improvement program will continue in 2025.Financially, Aeroflot posted a net profit of 22 billion rubles ($220 million) under Russian Accounting Standards (RAS) in 2024. Additionally, for the first nine months of the year, the airline recorded 60 billion rubles ($600 million) in revenue under International Financial Reporting Standards (IFRS). Full-year results are expected to remain positive.<h3>Operational Safety and Fleet Maintenance</h3>Aeroflot’s operational safety index for 2024 reached 99.977%, with an incident rate of one every 5,730 flight hours— the best record since 2017. The airline assured that it has no issues maintaining its fleet, as it possesses all necessary spare parts and operates one of the largest hangar capacities in the industry.Throughout 2024, Aeroflot reported 800 onboard incidents. In 28 cases, restraint devices were used, and in five instances, emergency landings were required. The airline is working with Russia’s Ministry of Transport to tighten aviation security regulations.<h3>Investing in AI and IT Solutions</h3>With limited local aviation IT solutions available, Aeroflot is investing in proprietary technology development. The airline is collaborating with AI firms to integrate new technologies into operational processes, fuel efficiency management, and commercial strategies.<h3>2025 Outlook</h3>Aeroflot’s primary goal for 2025 is to sustain passenger traffic and financial performance at levels comparable to 2024 while reinforcing its growth and market expansion.

Aeroflot CEO Outlines 2024 Achievements and 2025 Goals

Russia faces significant challenges in achieving its ambitious civil aircraft production goals due to restrictions imposed by international sanctions. The country had set a target to manufacture 1,000 passenger planes by 2030, but by the end of 2024, only a few Sukhoi Superjets had been delivered, assembled using parts stockpiled before the sanctions.<a href="https://simpleflying.com/russia-slashes-airlner-engine-production-domestic-airliner-flounders/">According to Simple Flying</a>, citing the Russian website <a href="https://www.kommersant.ru/doc/7360678">Kommersant,</a> the production of aircraft engines—key to new plane manufacturing—has been significantly scaled back. Originally, plans were in place to produce 24 engines for the Yakovlev MC-21, a competitor to the Boeing 737. However, this goal has been reduced to just seven units. The engines, particularly the Aviadvigatel PD-8, remain unready, with ongoing revisions following problems identified during testing.Efforts to "Russianize" aircraft, by replacing imported components with locally manufactured parts, have proven to be a daunting task. Critical components for aircraft like the MC-21 and Sukhoi Superjet typically come from Western countries, including the United States, Europe, and Canada. This dependency has severely hampered progress, as these planes cannot operate without the certification of such components.<h3>Challenges with Aircraft Design and Certification</h3>Replacing foreign components has led to increased weight, reduced range, and decreased performance in planes like the MC-21. Initially, up to 70% of its parts were imported; now, domestic substitutes must be used. The lack of a certified collision avoidance system (TCAS) further complicates matters, preventing legal operation of Russian-built aircraft. Despite more than 12 years of development, this system remains uncertified.<h3>Limited Resources and Financial Strains</h3>The Russian civil aviation sector also struggles with economic constraints, as it competes for limited resources with the military industry, which is prioritized. Furthermore, Russian-made engines are more expensive and less efficient than their Western counterparts. For example, the PD-14 engine costs approximately double the price of the American PW1000G, further driving up operating costs for airlines.<h3>Market Challenges for the Superjet</h3>The Superjet, a 100-passenger plane, faces another obstacle: limited market demand. It accounts for just 5% of global demand for commercial aircraft, and Russia's largest airline, Aeroflot, has attempted to cancel its Superjet orders, preferring larger models like the MC-21.<section class="noteSuggested" data-id="34470" data-title="You might be interested"></section><h3>Broader Implications</h3>The crisis in Russian aviation is similar to that faced by countries like Iran and Cuba, which have also struggled to maintain fleets without access to Western planes and components. However, Russia’s vast geography and heavy reliance on commercial aviation for domestic connectivity amplify the problem.As older aircraft become more expensive to maintain, Russian airlines face the risk of a shortage of modern planes, forcing reliance on aging fleets or higher ticket prices for passengers. Experts believe that the goal of producing 1,000 planes by 2030 is highly unrealistic, with deliveries likely postponed for several years.The future of Russian commercial aviation remains uncertain as the country navigates the constraints of sanctions and technological challenges.

Why Russia’s Civil Aviation Industry is Falling Behind in Aircraft Production

The Russian government’s confiscation of nearly 400 aircraft, following international sanctions imposed due to the war in Ukraine, has triggered an unprecedented legal and financial conflict in the aviation sector. These aircraft, owned by major leasing companies, were seized and registered in Russia, resulting in estimated collective losses of $10 billion for the affected firms.The conflict has now shifted to courts in Dublin and London, where leasing giants such as SMBC, Avolon, BOC Aviation, CDB Aviation, Nordic Aviation Capital, and Hermes Aircraft are pursuing the recovery of approximately €2.5 billion. Ireland plays a pivotal role in the industry, as over 60% of the world’s leased aircraft are registered there.<a href="https://aeroin.net/avioes-na-russia-nao-estao-definitivamente-perdidos-dizem-seguradoras-de-aeronaves-as-lessoras/">According to our affiliated outlet Aeroin</a>, the legal proceedings involve more than 180 lawyers and focus on whether the aircraft should be classified as irreparable losses, as claimed by the leasing companies, or if they remain recoverable assets, as argued by insurers.<h3>The position of the insurers</h3>Prominent insurers such as Lloyd’s, AIG, and Chubb have rejected the leasing companies’ claims, asserting there is no evidence of destruction or substantial damage to the aircraft. According to these insurers, the registration of the aircraft in Russia does not constitute a definitive loss, which, if upheld, would exempt them from paying the requested indemnities.The outcome of this case could set a precedent for the global aircraft leasing and insurance industry, as the vulnerability of the leasing model to extreme geopolitical events has been starkly highlighted. This could lead to significant changes in insurance practices and contract drafting across the sector.Meanwhile, the financial repercussions of the losses remain a major challenge for the leasing companies, which are confronting one of the most significant legal battles in their history.

Insurers Reject Claims for Confiscated Aircraft Registered in Russia

16The Aeroflot Group announced that it expects to receive its first unit of the MC-21 aircraft in 2026. Ivan Batanov, Director of Aeroflot’s Network and Revenue Management Department, reported during the PRO//Movement Passenger Forum that the company is actively working with the manufacturer to customize the aircraft according to its specific needs.
This forecast aligns with earlier statements by Russian Prime Minister Mikhail Mishustin, who indicated that deliveries of this domestically manufactured aircraft could begin in 2025, according to a report from our partner media outlet, <a href="https://aeroin.net/com-ajuste-de-cronograma-primeiro-jato-russo-mc-21-deve-chegar-para-a-aeroflot-em-2026/" target="_blank" rel="noopener">AEROIN</a>.
The MC-21 is designed for both domestic and international markets, aiming to replace older models such as the Tu-154 and the Tu-204 family, and serve as an alternative to foreign aircraft. Designed for short- and medium-haul routes, it can transport passengers, luggage, and cargo. Several versions of the aircraft are planned, with capacities for 150, 180, and 210 seats, and a range of up to 6,000 kilometers.
See also: <a href="https://aviacionline.com/2024/10/rusia-amplia-la-planta-de-irkutsk-para-producir-36-aviones-mc-21-por-ano/" target="_blank" rel="noopener">Russia expands the Irkutsk plant to produce 36 MC-21 aircraft per year</a>
This project aims to revitalize Russia&#8217;s aviation industry, promoting technological advancements and innovations in the country’s civil aviation sector. Customization collaborations for the MC-21 may include aspects related to passenger comfort, fuel efficiency, and environmental performance.
The production of the MC-21 has been significantly affected by sanctions imposed on Russia following its military actions in Ukraine. The original version of the aircraft, the MC-21-300, was initially intended to be equipped with U.S.-made Pratt &amp; Whitney engines. However, due to the sanctions, Russia has switched to domestically produced PD-14 engines. This transition, along with the need to replace numerous Western-origin components, delayed the aircraft’s entry into service.
The sanctions have also prompted Russia to adopt a broader import substitution strategy, with state-owned companies such as Rostec leading efforts to increase self-reliance in aircraft production. Despite these challenges, Russia plans to deliver more than 500 domestically produced aircraft to its airlines by 2030, including the MC-21 and other models like the Superjet-NEW and the Tu-214. However, experts question whether the country will be able to meet these ambitious goals, given the significant setbacks and delays encountered in production so far.

Aeroflot Prepares for 2026 Delivery of Custom-Built MC-21 Airliner

Aeroflot is exploring the possibility of acquiring Boeing 737-800BCF cargo aircraft from the subsidiary of Volga-Dnepr, Atran. According to a report by the Russian newspaper Kommersant, the operation aims to use these aircraft as a source of spare parts for its low-cost airline, Pobeda.
The agreement, which would be the first of its kind in Russia, would involve the transfer of usage rights over five Boeing 737-800BCF aircraft, whose valuation at the end of 2022 ranged between 8 and 9 billion rubles (USD 75 to 85 million). The aircraft, currently managed by Atran, are owned by AerCap, a leasing company based in Ireland.
<figure id="attachment_348440" aria-describedby="caption-attachment-348440" style="width: 1588px" class="wp-caption aligncenter"><a href="http://aviacionline.com/wp-content/uploads/2024/12/pobeda-rusia-737-800.jpg"><img src="https://aviacionlinecdn.eleco.com.ar/media/2024/12/pobeda-rusia-737-800.jpg" alt="Pobeda" /></a><figcaption id="caption-attachment-348440" class="wp-caption-text">Pobeda.</figcaption></figure>
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<h4>Interest in key components</h4>
According to Kommersant, Aeroflot does not plan to convert these cargo aircraft into passenger planes, as international sanctions would make the process significantly more challenging and costly. Instead, the airline is primarily interested in engines, landing gear, avionics systems, and other essential components to be used in Pobeda&#8217;s fleet, which exclusively consists of Boeing 737-800s.
See also: <a href="https://aviacionline.com/2024/12/aeroflot-and-ifly-partner-in-landmark-wet-lease-deal-for-airbus-a330-operations/" target="_blank" rel="noopener">Russia with ACMI: following regulatory changes, Aeroflot adds four Airbus A330s on wet lease</a>
Aeroflot&#8217;s interest in these aircraft is not new. Atran operates six Boeing 737-800BCFs, with a combined valuation of 10.5 billion rubles at the end of 2022. In the past, another Russian airline, S7 Airlines, also attempted to acquire these aircraft but failed to reach an agreement.
The report highlights that this operation takes place against a backdrop of international sanctions, which have prompted Russian airlines to seek alternative solutions to ensure continuity in their operations. According to experts cited by Kommersant, settlement agreements like the one Aeroflot is pursuing are effective and legal tools for managing such transactions in the current context.
Aeroflot already has experience with this type of negotiation, having acquired a Boeing 737-800 from Royal Flight in 2023 under a similar agreement. This bolsters expectations of success for the new operation, which could become a reference model in the Russian aviation sector.

Russian Aviation Adaptation: Aeroflot Targets Boeing 737-800BCF Components

Russia is working on the development of new two-dimensional nozzles for the second-stage vector engine of the Su-57 Felon, an innovation that will enhance its stealth capabilities in the rear section without compromising the high maneuverability characteristic of next-generation Russian fighters.
<figure id="attachment_348313" aria-describedby="caption-attachment-348313" style="width: 1910px" class="wp-caption aligncenter"><a href="http://aviacionline.com/wp-content/uploads/2024/12/motor-2D.jpg"><img src="https://aviacionlinecdn.eleco.com.ar/media/2024/12/motor-2D.jpg" alt="" /></a><figcaption id="caption-attachment-348313" class="wp-caption-text">When tilted, two asymmetrically installed two-dimensional nozzles could offer excellent roll control to the Su-57.</figcaption></figure>
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The current production Su-57 and the Su-35 use the same AL-41F-1 engine, an upgraded version of the AL-31 that powers the Flanker family of fighters. This engine incorporates a three-dimensional thrust-vectoring nozzle, also known as a thrust-vectoring axisymmetric nozzle, enabling control of the pitch, yaw, and roll axes, which provides outstanding maneuverability.
For the improved version of the Su-57, called <a href="https://aviacionline.com/2022/10/primer-vuelo-del-sukhoi-su-57-modernizado/" target="_blank" rel="noopener">Su-57M</a>, the AL-51F1 engine (also known as izdeliye 30) is under development. This is a next-generation turbofan engine that will offer greater thrust, reduced weight, and lower operational costs compared to its predecessors. Additionally, it will feature new two-dimensional nozzles, specifically designed to improve stealth capabilities, particularly in the aircraft&#8217;s rear section.
<figure id="attachment_348315" aria-describedby="caption-attachment-348315" style="width: 1910px" class="wp-caption aligncenter"><a href="http://aviacionline.com/wp-content/uploads/2024/12/Su-57-motor-2D.jpg"><img src="https://aviacionlinecdn.eleco.com.ar/media/2024/12/Su-57-motor-2D.jpg" alt="" /></a><figcaption id="caption-attachment-348315" class="wp-caption-text">The new nozzle seems to incorporate solutions to reduce the thermal signature of the exhaust gases.</figcaption></figure>
Initially, the AL-51F1 featured a “traditional” round nozzle with a faceted design, similar to that used in the F-35 Lightning II, but with three-dimensional thrust-vectoring capabilities. However, recent images revealed in the trailer for the documentary “Lords of the Sky”, produced by Russian Channel 7 to commemorate the 85th anniversary of the Sukhoi and MiG design bureaus, show that the final configuration of the Su-57M engine will include a new two-dimensional nozzle, a key feature to enhance the aircraft&#8217;s radar and infrared stealth.
<iframe loading="lazy" title="Плоское сопло на Су-57" width="1200" height="675" src="https://www.youtube.com/embed/qyeBNc2A2NI?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>
Unlike the F-22 Raptor&#8217;s nozzle, which provides excellent pitch control by directing exhaust gases upward or downward, the Russian two-dimensional nozzle features an inclined configuration, likely designed to also enable roll control when mounted asymmetrically.
<figure id="attachment_348316" aria-describedby="caption-attachment-348316" style="width: 922px" class="wp-caption alignnone"><img src="https://aviacionlinecdn.eleco.com.ar/media/2024/12/casco-HMD.jpg" alt="" /><figcaption id="caption-attachment-348316" class="wp-caption-text">HMD helmet in development for the Su-57 and other Russian fighters.</figcaption></figure>
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Finally, the video also showcases a new pilot helmet with a helmet-mounted display (HMD) system, currently under development. This system, already being implemented in the latest combat aircraft worldwide, is expected to be available for the Su-57M and other Russian combat aircraft in the future.

Russia Develops Two-Dimensional Nozzles for Enhanced Stealth in Su-57 Felon Fighters

In aviation, airlines seek flexible solutions to operate their fleets and adapt to the changing market demand. Two key leasing models are ACMI and dry lease, each with specific features that make them useful in different contexts. Additionally, recent events such as Abra Group&#8217;s acquisition of Wamos Air or Flybondi&#8217;s incorporation of four aircraft under wet-leasing highlighted the relevance of ACMI leasing in the industry.
<h4>ACMI leasing: An all-inclusive solution</h4>
ACMI leasing (short for Aircraft, Crew, Maintenance, Insurance) offers a comprehensive solution. Under this model, an airline (the lessor) provides not only the aircraft but also the crew, maintenance services, and insurance. The airline leasing (the lessee) takes on other costs such as fuel, airport fees, and ticket sales.
This type of contract is particularly useful for managing seasonal demand peaks, delays in new aircraft deliveries, or unforeseen operational situations. For instance, Wamos Air, now part of Abra Group, is known for offering ACMI services to airlines worldwide, enabling them to efficiently manage their capacity.
<h4>Dry lease: Simpler but strategic</h4>
In contrast, the dry lease is a simpler model where the lessor only provides the aircraft. The lessee handles all operational aspects, including crew, maintenance, and insurance. This model is ideal for airlines with operational expertise that are looking to expand their fleet in a planned manner. It is often used in long-term contracts aimed at sustainably increasing capacity.
<h4>Main differences between ACMI and dry lease</h4>
ACMI leasing includes additional services, making it perfect for short- and medium-term needs, while dry lease is better suited for long-term contracts where the airline has full operational capacity. In terms of responsibility, ACMI relieves the lessee of tasks such as maintenance or crew management, which in dry lease are fully assumed by the leasing airline.
On the other hand, ACMI leasing is ideal for addressing operational emergencies or quick capacity adjustments, while dry lease caters to more robust long-term expansion strategies.
<h4>Abra Group and Wamos Air: A recent example</h4>
The recent purchase of Wamos Air by Abra Group illustrates how major airlines are leveraging the ACMI model to enhance their operational flexibility. Abra Group, which also includes brands such as Avianca, GOL, and Viva, positions itself as a key player in the Latin American market. The incorporation of Wamos Air provides them with a versatile tool to respond to fluctuating regional and international demand.
<h4>A constantly evolving market</h4>
ACMI leasing continues to grow in popularity due to its flexibility and ability to address operational problems immediately. Examples like the partnership between Avion Express and Flybondi in Argentina show how airlines are using this model to manage high seasons and optimize their operations.
Meanwhile, dry lease remains a solid option for airlines with long-term expansion strategies. Each model has its place in the industry, and depending on the specific needs of the airline, it can make the difference between an efficient operation and an overloaded one.
Ultimately, ACMI and dry leasing are complementary tools that allow airlines to adapt to the challenges and opportunities of a market as dynamic as aviation. The key lies in knowing when and how to use them to maximize their benefits.

ACMI vs Dry Lease: Key Differences and Benefits for Airlines

Aeroflot will become the first Russian airline to operate three Airbus A330 aircraft under a wet-lease agreement following the recent reform of the Russian Air Code. This measure allows airlines in the country to lease aircraft with crew for domestic operations, something previously prohibited.
The preliminary agreement, announced on November 30, 2024, involves the addition of three Airbus A330 aircraft from Moscow-based charter airline iFLY. iFLY primarily operates from Vnukovo International Airport and conducts flights on behalf of Russian tour operator TEZ Tour. Once the deal is finalized, Aeroflot will increase its Airbus A330 fleet to 15 units, enhancing its capacity to serve high-demand domestic routes.
According to an Aeroflot statement, the leased A330s will be deployed on long-haul flights from Moscow to destinations in eastern Russia such as Vladivostok, Khabarovsk, Yuzhno-Sakhalinsk, and Petropavlovsk-Kamchatsky.
<h4>A historic regulatory change</h4>
The reform of the Air Code, which came into effect on September 1, 2024, legalized wet leasing in Russia. Until then, this mechanism faced regulatory hurdles and geopolitical tensions. The conflict with the European Union and the United States, coupled with international sanctions, complicated the operations of foreign aircraft in Russian airspace.
Dmitry Yadrov, director of the Federal Air Transport Agency, explained: «Leasing with crew is an innovative mechanism that will drive the development of civil aviation in our country. It will allow airlines to quickly expand their fleets during periods of high demand or when introducing new routes, as well as reduce fleet management and payroll costs. In other words, wet leasing will benefit all parties involved, increasing mobility for our citizens.»
iFLY, known for operating charter flights for TEZ Tour, expands its role in the industry by becoming a strategic partner of Aeroflot under this agreement. This positions it as a key player in the domestic wet lease market, a newly adopted modality in Russia.
The reform of the Russian Air Code and the agreement between Aeroflot and iFLY mark a significant shift in domestic aviation strategy. Aeroflot strengthens its presence in the domestic market, while iFLY emerges as an essential partner in this new modality. However, challenges related to operational integration and international restrictions continue to shape the aviation landscape in Russia.

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