Reduce Dependency on Russian Titanium: Aerospace OEMs Seek Alternatives

Aerospace OEMs Work to Reduce Reliance on Russian Titanium
As supply chain challenges increase due to rising global tensions, aerospace original equipment manufacturers (OEMs) like Airbus and Safran are actively seeking to decrease their dependency on Russian titanium producer VSMPO-AVISMA. This urgency has intensified following Russian President Vladimir Putin’s recent announcement regarding export restrictions on critical metals such as titanium, nickel, and uranium.

Airbus Implements Multi-Sourcing Strategy
Airbus, a leading European aircraft manufacturer, is focusing on supply chain resilience by diversifying its network of metal suppliers. An Airbus spokesperson indicated that efforts are in progress to secure alternatives through multi-sourcing strategies. However, the company has not provided a timeline for completely ending its relationships with Russian suppliers.

Safran Reduces Reliance on Russian Titanium
French aerospace manufacturer Safran has been actively working to lessen its dependence on Russian titanium since February 2022. The company has made considerable progress in qualifying alternative, non-Russian sources of titanium. A Safran representative noted that while qualifying new suppliers typically takes 2-3 years, the process is nearing completion. However, scaling up production to meet current demand remains a significant challenge across the industry.

Challenges in Securing Alternative Supplies
Transitioning away from VSMPO-AVISMA, the world’s largest titanium producer, has proven complex for aerospace OEMs. Key obstacles include exclusive contracts for critical components, such as landing gear, and limited capacity for large-scale forgings and machining. Airbus confirmed in October that it continues to honor existing contracts in compliance with international sanctions, while reiterating its long-term aim to decouple from Russian supply chains.

Boeing’s Immediate Action and U.S. Response
In contrast, American aircraft manufacturer Boeing halted all procurement from VSMPO-AVISMA in March 2022 and ended its joint venture with Ural-Boeing Manufacturing. Following these actions, the U.S. imposed a 70% duty on titanium imports from Russia, further isolating the Russian supplier from the American market.

Titanium and Nickel’s Vital Role in Aerospace
Titanium is essential in aerospace applications, used in structural parts, fasteners, compressor blades, landing gears, and heat exchangers. Nickel, also facing export restrictions, is primarily utilized in high-temperature superalloys for jet engine hot cores.

Global Sanctions and Industry Reactions
The EU has not yet imposed specific sanctions on VSMPO, contrasting with the more aggressive actions taken by the U.S. and Canada. Canada’s direct sanctions initially affected companies like Airbus and Bombardier, but both received exemptions. Meanwhile, U.S.-based RTX faced complications and had to secure new titanium sources for its subsidiary, Collins Aerospace, which manufactures landing gear in Canada.

Future Prospects for Titanium Supply
In response to the growing demand and the gap left by VSMPO, U.S. titanium producers like Timet, ATI, and Perryman are increasing their ingot melt capacities. Similarly, Japanese manufacturers Toho Titanium and Osaka Titanium are investing in capacity expansion, though these efforts will take several years to fully materialize.

Uncertainty Surrounding Russian Export Restrictions
It remains unclear whether Russia will proceed with its export restrictions. Safran has indicated it lacks further information beyond Russia’s public statements, and Airbus has chosen not to comment. VSMPO’s largest shareholder, Industrial Investments, holds a 65.27% stake, while the Russian state-controlled defense firm Rostec owns 25%. Putin’s call for restrictions included a condition that they should not harm Russia, leaving the industry in uncertainty.