ABSTRACT
Aircraft manufacturing is characterised by technological complexity, high value-added, dual-use application, constant innovation and strategic relevance. Possessing an aircraft industry is therefore regarded as a matter of national interest that serves to fulfil both economic and security objectives. Nevertheless, the heavy R&D investments, high level of engineering expertise, sophisticated techno-industrial assets and advanced management skills required to develop aircraft production capabilities have resulted in few countries possessing the capacity to manufacture complete aircraft platforms. Those that do have traditionally relied on government intervention to keep the industry afloat in times of contracted demand, and constant political support to gain competitive advantages and increase international market shares. Indeed, aircraft enterprises operate in an atypical oligopolistic market influenced by political variables. As such, their performance is determined by both corporate strategy and government policy. Since the aircraft industry is typically associated with technological superiority, international prestige, and military and industrial prowess, it comes as no surprise that the USSR possessed a very robust aircraft manufacturing system that at its heyday produced 40 per cent of the world’s military aircraft and 25 per cent of all aircraft platforms (De Kort and Kluiters, 2003, p. 381). This output had strong military production as its backbone and was therefore the result of high defence expenditures, representing 25 per cent of Soviet GDP (Gansler, 2011, p. 322).
