Russia's New Airliner Readies for Takeoff

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More generally, foreign involvement in the project has been crucial in ensuring that it meets the exacting technological standards demanded by international airlines. In June Alenia Aeronautica, a unit of Italian aerospace concern Finmeccanica (SIFI.MI), acquired a 25% stake in the project for $250 million. Under the contract, the Italians will supply parts for the aircraft and will own a majority stake in the unit that will be responsible for marketing. Boeing also has been a consultant, providing advice on areas such as project management and customer support.

True, not everyone is convinced of the Superjet's potential for success. Regional jets became all the rage in the 1990s, when the rise of budget airlines led to a surge in demand for smaller and cheaper aircraft used for shorter flights. But the regional jet market has more recently taken a downturn. Rising fuel costs have changed the economics of the airline industry, increasing the preference for larger aircraft covering longer distances. Skeptics note that the market share of regional aircraft plummeted from 17% in 2004 to 13% in 2006, according to statistics compiled by Boeing.

Encouraging Signs for Sales

Another problem is that Russia isn't alone in wanting to enter the market. The Chinese also are hard at work on their first commercial jet, the ARJ-21, which will have between 70 and 110 seats. It's due to begin full-scale production in 2009. Japan's Mitsubishi recently announced that it also wants in on the market, unveiling the model of its 72- to 92-seater MJ (Mitsubishi Jet) in June.

None of that is deterring the Russians, who already have orders for 73 Superjets on the books and plan to begin production next year. Although most of those orders have come from Russian airlines, including 45 from flag carrier Aeroflot (AFLT.RTS), Sukhoi also has attracted its first international buyers (BusinessWeek, 8/22/07). In June Italy's ItAli airline put in an order for 10 Superjets, with options for ten more. A number of other Western airlines also are reported to be eyeing the aircraft, with Hungary's Malev and Scandinavian Airlines System (SAS.ST) rumored to be finalizing orders. "There are already foreign buyers, even though they haven't seen the aircraft yet," says Evgeny Shago, aviation analyst at Trust Investment Bank in Moscow. "It's a very good sign."

With reporting from Anna Smolchenko

Bush is BusinessWeek's Moscow bureau chief .