The State and Prospects for Development of the Russian Civil Aviation Industry in the Global Competition

The aviation industry plays a crucial role in the social and economic development of the Russian Federation and contributes to the technological development of the country being a matter of prestige in the international arena. Nowadays, the Russian civil aviation industry is facing difficulties in maintaining its competitiveness in foreign markets. The total share of domestic aircraft manufacturers in global passenger aircraft deliveries does not exceed 1%. The purpose of this research is to determine prospective directions of development of the Russian civil aviation industry in the context of global competition. To meet the purpose of the study the analysis of the current state and development trends of the global and domestic civil aviation markets as well as quantitative analysis of potential internal market demand for civil jets was made. It was revealed that the global market has high exit barriers. Considering serious structural problems in the industry, including those related to export activities, it was found that focusing primarily on the global market is not a prospective direction of the national ​​industry development in the context of international competition. To determine the potential competitive positions of the Russian civil aviation industry, an attempt to quantify the domestic market demand for Russian civil jets for the period from 2020 to 2022 was made with the use of econometric modelling. As a result, it was identified that for a three year period internal demand in the segment of regional and narrow-body aircraft is almost completely met by domestic manufacturers. In the segment of wide-body aircraft national demand will be entirely satisfied by Western manufacturers. It was revealed that focusing solely on the domestic market with the goal of increasing the global industry competitiveness is not a promising direction of development, since the values of domestic demand for Russian aircraft are not sufficient to fully load production capacities and create mass production in the Russian Federation. Achieving a balance between expanding presence in the domestic and foreign markets is the most prospective scenario for the development of the Russian civil aircraft industry in the context of international competition. Recommendations to improve the global competitiveness of national industry were also made in this study.