August 22, 2008

Boeing and VSMPO Avisma ink USD 1 billion deal

It is reported that Boeing Co has entered into a USD 1 billion agreement with Russian titanium producer VSMPO-Avisma Corp to source various titanium products from 2011 through 2015. The contract follows a series of agreements between the aircraft builder and the nonferrous producer in recent months.

In the new agreement, it will supply billets, bars, sheets, and plates, raising its standing as Boeing’s largest Russian partner.

Earlier this year, the two firms formed a Russian joint venture, Ural Boeing Manufacturing, which will machine titanium forgings for use in manufacturing the Boeing 787 Dreamliner aircraft. The two have had a series of long term agreements in place since 1997.

Mr Sergey Kravchenko president of Boeing Russia & CIS said “This contract is a serious contribution to development of the large scale program for procurement of Russian titanium to the amount of USD 18 billion from VSMPO-Avisma, our key partner in Russia.”

He added that “Boeing plans investments of USD 27 billion in Russia over the next 30 years. This amount also includes payment for a number of contracts for delivery of products, materials, and services of Russian companies, including cooperation in space industry and engineering works in Boeing Design Center in Moscow.”

VSMPO-Avisma, headquartered at Ekaterinburg in Russia, is the world’s largest producer of titanium metal and titanium mill products.