ZHUKOVSKY (Moscow Region), August 18 (RIA Novosti) - Russia's prime minister criticized the country's United Aircraft Building Corporation (UABC) on Tuesday for selling planes to domestic and foreign companies at a loss.
"A number of the UABC's contracts for aircraft supplies both to domestic and foreign consumers have resulted in direct losses, instead of profits," Vladimir Putin said. He urged for steps to prevent the situation from continuing.
Putin said the state corporation and its subsidiaries owed some $3.7 billion to creditors, and that previous plans to pay the debt through selling unprofitable assets, refinancing, or floating shares had failed due to the credit crunch.
The premier instructed relevant government departments to draft a financial rehabilitation program for the national aircraft making sector by October 1.
He also called for proposals to improve mechanisms for encouraging Russian-made aircraft sales, in particular "leasing development on the domestic market and measures to encourage exports."
The UABC in which the government controls a 91.34% stake, has charter capital of 110.28 billion rubles ($3.45 bln). Established to streamline the Russian aviation industry, the company incorporates aircraft building firms and state assets engaged in the manufacture, design and sale of military, civilian, transport and unmanned aircraft.
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