LONDON — While the headlines at this week’s Farnborough Airshow will almost certainly revolve around the two largest manufacturers of commercial aircraft, Boeing and Airbus, a competitive threat is quietly brewing in Russia.

Bombardier’s CSeries and the pair of Chinese jets (COMAC C919 and ARJ-21) are often mentioned as competitive threats to the Boeing-Airbus duopoly. However, the most successful and capable aircraft in the actual size class of the core Airbus and Boeing narrow body jets is Irkut’s MC-21.

Irkut is a subsidiary of Russia’s state-owned United Aircraft Corporation (UAC), which also encompasses the other famous Russian named aerospace brands including Ilyushin, Sukhoi, Tupolev, and Yakolev. While these are all theoretically independent divisions with their own operations, in practice all of UAC’s subsidiaries share design resources and funds. Thus the Sukhoi Superjet, arguably the most successful airplane distributed today by a manufacturer outside of the global big four (Airbus [including ATR], Boeing, Bombardier, Embraer) is also a UAC product in practice.

UAC has already struck gold with the Superjet

Indeed while Russian aircraft suffer, we would argue unfairly, from a perception of poor technical quality, the Superjet is absolutely competitive with the aircraft in its class (Bombardier’s CRJ1000, Embraer’s E190, and inclusive of pricing the E190-E2 and CS100). It has won 368 orders including more than 100 from airlines outside of Russia, and it’s actual performance in service with airlines ranging from low cost carrier (LCC) Interjet in Mexico to Aeroflot has won rave reviews.

The true testament is that since its launch, the Superjet has won more or less even market share with the competing products from Bombardier and performed respectably in terms of market share versus Embraer. These figures are perhaps inflated by performance in the local Russian market, but that is no different than Air Canada boosting the CSeries or Azul boosting the EJets in the respective local geographies. Perhaps the only thing that has hamstrung the SSJ’s ascendance is the lack of a high-quality Western engine (Russian engine makers do lag behind their counterparts in the west in terms of performance and after sales service).

The MC-21 competes head to head with the A320neo and 737 MAX

The MC-21 faces no such concerns, as it will be powered in part by the Pratt & Whitney PW1400G geared turbofan (GTF) engine. Variants of the GTF also power Bombardier CSeries, Embraer EJets-E2s, and Airbus A320neos, and while Russian customers for the type such as Aeroflot may opt for the Russian built Aviadvigatel PD-14 power plant, the GTF will make the MC-21 competitive for orders outside of Russia.

Indeed, our analysis shows that while the PD-14-powered MC-21 lags slightly behind the 737 MAX and A320neo, the MC-21 powered with the GTF is more or less competitive in terms of trip costs and unit operating costs (CASM) depending on configuration, especially once capital costs are included (more on this below.)

Stepping back for a second, the MC-21 actually comes in two variants, the MC-21-300 which seats roughly 140 passengers in a standard two-class configuration (though it is similarly sized to the Airbus A320) and the MC-21-300 which seats about 170 passengers in the same two class configuration and is similarly sized to the Boeing 737-900ER. The MC-21-300 is the base model of the program, with the MC-21-200 planned for development once the -300 enters service. Each aircraft is capable of flying more than 3,000 nautical miles (3,500 for the -200, 3,200 for the -300) yielding enough range to, for example, fly trans-continental routes in the United States. There is also a planned MC-21-400 aircraft with a longer fuselage and enlarged wing which would compete in the middle of market (MoM) space head to head with the Airbus A321.

For the moment, the MC-21 has 192 firm orders and 88 purchase options from 10 airlines, including 50 from launch customer Aeroflot. The majority of the customers are Russian, though Cairo Aviation (an Egyptian carrier) and Azal Azerbaijan Airlines have also ordered 16 copies of the MC-21 between them (Azal will actually lease its frames from Ilyushin Finance Company. This pales in comparison, obviously, to the 3,000+ firm orders for the 737 MAX and A320neo, but the MS-21 is still on pace to sell more than 500 copies over the next 15 years or so.

First flight between December 2016 and February 2017; EIS in 2018

The MC-21 was actually rolled out just over a month ago at a UAC hangar in Irkutsk, Russia, marking the culmination of a six-year process that saw development cost of $3.5 billion. When it was launched back in 2010, the MC-21 was planned for EIS in 2016, but subsequent delays and a constriction of UAC’s supply chain for Western aircraft components due to economic sanctions placed on Russia have pushed that timeline back to 2018.

In the meantime, UAC is hopeful  for a first flight before the end of 2016, though the official timeline ranges from December of this year to February of next. Throughout 2017, flight tests and certification will be completed, allowing EIS in 2018, when four aircraft will be built. Production is then planned to increase to 20 aircraft per year in 2020 and finally 70 per year in 2023, though its still up in the air where the orders for this volume of production would come from.

Pricing can win customers but geopolitical and support risks persist

One of the biggest advantages that UAC has in drumming up business for the MC-21 is the ability to undercut Boeing and Airbus pricing on the 737 MAX and A320neo. According to multiple reports, Irkut has been selling the MC-21-300 at a 15-20% discount versus the competing Airbus and Boeing products, emboldened by lower costs of production in Russia and the declining value of the ruble against international currencies like the Dollar or Euro. That kind of pricing can be attractive to customers, particularly second tier ones, in developing nations of regions like Africa, Asia, and Latin America. Russia’s willingness to back industrial exports with aggressive financing foreign customers will also help.

But in some ways the deck is stacked against Irkut and UAC as a whole. Russia remains embroiled in geopolitical uncertainty, with economic sanctions hanging heavily over the Russian economy and its exports to more developed nations in East Asia, Europe, and North America. Furthermore, Irkut has yet to prove that it can provide maintenance and parts support on a global scale, and customers without geographic nexus to Russia and the former CIS such as airlines in South America or Indonesia might hesitate to buy from a manufacturer reliant on third party providers such as Lufthansa Technik.

Still, despite the challenges, Irkut has done well to get the MC-21 to market and built a high quality airplane. Now the question is whether it can replicate the out of Russia success of its smaller cousin, the Superjet SSJ100.