Conflicts and militant attacks in the Middle East and elsewhere will offset falling demand for helicopters driven by softer oil prices, the head of Russsian Helicopters said yesterday.
Russian Helicopters, part of state corporation Rostec, is unlikely to see any negative effect of lower petroleum prices this year due to committed orders and deliveries.
But the firm could see a decline in sales in 2016 and 2017 by about 10 to 15 per cent, chief executive Alexander Mikheev saidat the Dubai Air Show.
The market for helicopters, which are used extensively in the oil and gas industry, is dependent on oil prices that have fallen significantly in the last year, the chief executive said.
He suggested however demand spurred by security requirements looked robust.
“It is clear that local conflicts and terrorist attacks require helicopters more and more. So if there’s this demand, there’s no problem for orders,” Mr Mikheev said.
“We will also substitute decline in demand with after sales service.”
The company’s M-17 and M-18 helicopters proved very reliable in Afghanistan and can operate efficiently in very hot climates.
Local conflicts and terrorist attacks require helicopters
Over 500 Russian helicopters are in operation in the Middle East and North Africa, Mr Mikheev said.
Russian Helicopters plans to expand its production overseas in a joint venture in India.
“We are still in talks,” said Mr Mikheev declining to give a timeline. Talks are going on with India’s Hindustan Aeronautics Ltd, Reliance Defence & Aerospace and Larsen & Toubro for making KA-226 helicopters in India, he said.
Earlier this year Russian Helicopters signed an agreement with Aviation Industry Corporation of China (AVIC) regarding cooperation for heavy helicop-ter development. Russian Helicopters also has a joint venture with Augusta Westland for the development and manufacturing of single eng-ine helicopters.
The firm also plans to open a service centre for its military helicopters in Egypt in 2017, he said, adding that Egypt has 77 Russian helicopters.