Russia’s Deputy Defense Minister Yury Borisov announced this week that the plan to procure 35 AW139 helicopters from AgustaWestland has been cancelled only a week before the MAKS Air Show is to begin.
The defense ministry considers the helicopters too expensive at $700 million, Itar-Tass reported.
The loss of the contract could prove a major setback for HeliVert, the joint venture between Russian Helicopters and AgustaWestland that launched an assembly plant in the town of Tomilin, just south of Moscow, last year, the report added.
Prime Minister Dmitry Medvedev employs two AW139 helicopters to ferry him to and from his suburban residence and the White House, Vedomosti reported.
“The order is still under negotiation,” said Roberto Caprarella, a spokesman for AgustaWestland told Reuters.
Sukhoi's military division has also had some good news, signing a major contract last week to build 12 Su-30MK fighter planes for Vietnam.
The fighters will cost Vietnam about $450 million, a source close to the negotiations said, RIA Novosti reported.