September 19, 2018 / 6:18 PM / 2 months ago

VSMPO-Avisma and Boeing launch new titanium joint venture in Russia

YEKATERINBURG (Reuters) - Russia’s VSMPO-Avisma (VSMO.MM), the world’s largest titanium producer, and U.S. planemaker Boeing (BA.N) have launched a new manufacturing unit in Russia’s Urals region of Sverdlovsk, a local governor said on social media on Wednesday.

The joint venture (JV) will receive 5.5 billion roubles ($82.3 million) of investment, Evgeny Kuyvashev said.

Boeing spokesman Paul Bergman confirmed that Boeing and VSMPO-AVISMA had opened a second Ural Boeing Manufacturing joint venture facility.

It will focus on titanium forgings for Boeing commercial airplane programs including the 737 MAX, the 787 Dreamliner family and the 777X, Bergman said.

VSMPO-Avisma was not available for comment.

The new unit will operate alongside an existing JV between Boeing and VSMPO-AVISMA which has produced titanium forgings since 2009.

VSMPO-AVISMA supplies Boeing with titanium on long-term contracts. According to the Russian firm, it meets 35 percent of Boeing Commercial Airplanes’ demand for the metal.

In April, after the United States imposed a new round of sanctions on Moscow, Russian lawmakers called for an end to supplies of titanium to Boeing as a reciprocal measure. However, the proposal was not accepted by the government.

Reporting by Natalia Shurmina, Additional reporting by Eric M. Johnson in Seattle; Writing by Denis Pinchuk; Editing by Mark Potter and David Evans

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