Aircraft factory to remain in Kunovice after talks with Russian owners

An aircraft factory in the Moravian town of Kunovice is to remain in the Czech Republic. There had been fears that it would be moved to Russia but after talks with its Russian owners on Monday morning, the Czech minister of industry announced that the plant – and 200 jobs – would not be going anywhere.

Aircraft Industries, photo: CTK

The Aircraft Industries plant in the small town of Kunovice produces L-410 twin-engine, short-range transport aircraft. At least it usually does. It currently doesn’t have any orders and 200 employees are taking home 60 percent of their usual salaries.

Workers at the factory recently went on strike alert over news that its Russian owners, AI UGMK Holding, were considering upping sticks and moving the whole operation to their own country.

On Friday the employees dropped the threat of industrial action after the company paid their benefits.

The situation even sparked disagreements within the cabinet. Prime Minister Bohuslav Sobotka said the government would engage its diplomats in lobbying on the employees’ behalf, but Finance Minister Andrej Babiš said it was a private firm and such efforts would achieve nothing.

In any case, the employees got good news on Monday morning, when after talks with the Russian side, the Czech minister of industry and trade, Jan Mládek, said the former had pledged not to relocate the plant. They are due to confirm this promise with an official letter to Mr. Mládek’s department.

The head of the KOVO trade union, Jaroslav Souček, also took part in Monday’s meeting. He welcomes the latest development, which he says is also of significance at national level.

Jaroslav Souček|Photo: KOVO trade union

“It’s important not just for Kunovice and its surroundings – it’s important for the whole Czech Republic. If we were to lose that production, it would be a bad thing in view of past investments, when it was necessary to put hundreds of millions of crowns into aircraft development. We hope that the plant will be able to produce planes both for the Russian market and for the rest of the world.”

Mr. Mládek said the plant’s staff would not be twiddling their thumbs for long, with an order from Russia for 11 planes due to arrive in the near future.

According to union boss Jaroslav Souček, the Russian owners said the Kunovice plant would be back in full operation from November.

Aircraft Industries began experiencing difficulties due to the situation in Russian when the rouble weakened against the dollar. Last year it didn’t deliver a single plane to its main market and only sold four aircraft, to Bangladesh and Algeria.