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. Last Updated: 07/27/2016

China Plane Sale Puts Wind in Sirocco's Sails

China's agreement to buy five Tu-204-120C medium-range cargo planes, signed during Prime Minister Zhu Rongji's visit to St. Petersburg on Saturday, should open the door for more orders, the company that markets the planes said Monday.

"I would expect that with this announcement there will be further interest on the part of other Chinese airlines," said Thomas Smith, president and CEO of Sirocco Aerospace International.

London-based Sirocco, exclusive sales agent for the Tu-204-120s, which are fitted with Rolls Royce engines and Honeywell avionics, hopes to offer a serious alternative to the worldwide dominance of Boeing and Airbus, Smith said.

Set up in 1996 by Egyptian company Kato Aromatic to promote the Tu-204 abroad, Sirocco has worked in partnership with the Tupolev design bureau and Ulyanovsk-based aircraft producer Aviastar.

Saturday's deal was signed by aircraft export agency Aviaexport, Sirocco and two Chinese carriers.

Under the deal, three airplanes will go to China Southwest Airlines and two to China Northwest Airlines. Options for 10 more aircraft -- both passenger and cargo -- were signed, putting the potential value of the whole contract at some $500 million. Deliveries are expected to begin at the end of 2002 or the beginning of 2003.

The deal is part of a 1996 agreement between Sirocco, Tupolev and Aviastar for an order of 30 Tu-204s with an option for up to 170 more.

Smith said that within weeks Sirocco expects to announce more deals for Tu-204s -- with orders coming from China, the Middle East and Western Europe.

"We are talking to potential customers in the Middle East that are primarily interested in passenger aircraft. We are talking to five to 10 different airlines," he said. "The customers in Western Europe are primarily interested in the cargo model." Smith declined to elaborate.

In a related deal on Saturday, China agreed to honor Russian aircraft certification standards, but the Tu-204-120 still needs international recognition to sell elsewhere.

Smith said he hopes the European Joint Aviation Authorities will finish certifying the Tu-204-120 by the end of next year at a cost of $1 million to $2 million, which is to be provided by Sirocco. The company has already invested $200 million into the aircraft's development over the past five years.

Sirocco said it would open a product support center in China in the third quarter of 2002 to help maintain the planes, a service domestic producers have only begun to develop.

"If Russian aircraft have not got product support, it quite simply won't get any orders, so the product support center is an essential part of doing business internationally," said Paul Duffy, an independent Moscow-based aviation analyst.

Aviastar spokesman Alexander Savostyanov said that although the deal is not very big, it is "politically important as it shows that our aircraft is in demand and is competitive."