After several delays, Siberian regional airline UTAir finally expects to begin flying passengers aboard a pair of Avions de Transport Regional ATR 42-300s this month, marking the first use of Western-built turboprops in scheduled airline service in Russia. The ex-Continental Express airplanes arrived at UTAir’s base in Tyumen, Western Siberia, early last month after undergoing a thorough overhaul and avionics modifications by Montreal-based MRO provider ExelTech. Purchased by UTAir from Bank of America, the 1989-vintage airplanes flew under lease for Continental Express until about three years ago, when the airline grounded them in favor of regional jets.

UTAir, formerly known as Tyumenaviatrans, had originally agreed to take five ATR 42s from Irish lessor Magellen Air but, according to ATR Moscow sales director Vladimir Sazonkin, negotiations broke down when Magellan couldn’t deliver the airplanes in the 46-seat layout as specified in the tender.

ExelTech vice president of marketing and sales Donald Kamenz told AIN that UTAir chose to register the airplanes in Bermuda rather than Russia because Bermudan airworthiness standards more closely resemble FAA rules, requiring fewer changes to the airplanes’ basic configuration.

Still, judging by the extent of work ExelTech needed to do, Continental pushed the limits of the airplanes’ usefulness before sending them to storage in Roswell, N.M. “The aircraft literally had all kinds of work done,” said Kamenz. “I’m really not joking when I [ask], ‘What wasn’t done to them?’ A lot of structural repair, structural modification, avionics upgrades, EGPWS, engines, total landing gear overhauls, the whole bit.”

Delivery of the French-assembled airplanes marks the first phase of a plan to replace 11 fifty-seat Antonov An-24s with at least 15 ATRs. UTAir committed to the Franco-Italian turboprops after more than a year of cost analysis and negotiation with various suppliers, including Ukrainian Antonov An-140 builder KSAMC, Russian An-140 producer Aviacor and various dealers of used Bombardier de Havilland Dash 8 turboprops.

Because Russia imposes an 18-percent import tax and 20-percent value added tax on foreign-built airplanes, the only Western equipment ever to enter airline service received special tax exemptions in return for offset packages or as special dispensation for airlines vital to the national interest such as Aeroflot. In fact, not until 9/11 did prices on used Western turboprops fall to a level that has rendered their operation in Russia feasible. Only then did UTAir seriously begin considering the possibility of buying ATRs and Bombardier turboprops.

Although not subject to the same level of taxation as its Western competitors, the An-140 contains a considerable amount of non-Russian content, exposing it to import duties as well; at $8.5 million apiece, new An-140s would not come cheaply. That fact, along with UTAir general director Andrei Martirosov’s aversion to the Ukrainian airplane’s Klimov TV3-117VMA-SBM engines, which use a “helicopter-style” core and a heavy and complicated gearbox that transfers torque to its propellers via a long shaft, ultimately tilted the competition in the ATR’s favor.

Of course, the decision couldn’t have sat well with Ukraine’s aerospace establishment, regardless of the soundness of Martirosov’s economic rationale. “The An-140 is a newer design, with superior aerodynamics and better suited to operations in harsh environments,” said Antonov general designer Piotr Balabuev just before UTAir announced its choice. “[UTAir’s managers] will only prove themselves fools by buying ATRs.”

Named Russia’s Entrepreneur of the Year for 2005 by Ernst & Young, Martirosov has never played the fool and doesn’t expect to do so any time soon. As majority owner in UTAir, Martirosov oversees one of the world’s largest helicopter companies and one of Russia’s few profitable domestic airlines. The company operates a fleet of 169 Mil helicopters, including the world’s largest fleet of Mi-26s, as well as a thriving aircraft maintenance and repair center. Aside from the An-24s, UTAir’s airline division flies 13 Tupolev Tu-154s, 20 Tu-134s and 21 Yakovlev Yak-40s in passenger service to some 90 destinations.