Russia’s Rostec’s unit is in possession of a firm order for 35 Boeing 737 MAXs

Russian lessor Avia Capital Services, a 100 per cent subsidiary of Rostec, had filed a lawsuit in the USA cancelling its order for 35 Boeing MAX 8s (Wikicommons)

Avia Capital Services, the leasing arm of Russian industrial conglomerate Rostec which, amongst others, controls UAC, the producer of the MC-21 and Superjet 100 aircraft types, is in possession of a firm order for 35 Boeing 737 MAX 8 jets.

These details surfaced this week when the UK’s Financial Times reported that Russian lessor Avia Capital Services, a 100 per cent subsidiary of Rostec, had filed a lawsuit in the USA to cancel its order for 35 Boeing MAX 8s.

In a comment to Russian media, Avia Capital Services revealed that the first delivery of the aircraft was originally scheduled for October 2019, but the date was moved back to March 2022 when Boeing 737 MAXs were grounded worldwide in March, following crashes of the type in Indonesia in October 2018 and, just four months later, in Ethiopia.

On signing the deal, the Rostec division had paid the American aircraft manufacturer a cash deposit believed to be in the region of US$35 million.

The leasing company is now demanding that the deposit be returned with interest, plus $75 million in lost profits, as well as an undisclosed sum in compensatory damages. Avia Capital Services has, however, indicated its willingness to reach an out-of-court settlement.

The B737 MAXs were earmarked for a number of Russian airline clients, the company has revealed.

This is not the first experience for Avia Capital Services involving American-built narrow-bodies. In 2009, armed with a lease agreement from Aeroflot for 50 aircraft, it signed a sale and purchase agreement for 50 Boeing 737-800s and options for an additional 35 narrowbody aircraft. To date, of that number, 47 aircraft have been delivered to Russia’s dominant carrier.

Avia Capital Services was previously involved in a deal for 22 Boeing 787s, which were also initially intended for national flag carrier Aeroflot. The airline eventually relinquished the purchase option to the lessor, which then hoped to find new customers for the aircraft by October 2017 but failed to do so. Boeing did not penalise the company for breaching that contract, Sergey Chemezov, head of Rostec, said at the time.