(UNTITLED)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86T01017R000404520001-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 5
• Document Creation Date: January 12, 2017
• Document Release Date: April 22, 2011
• Sequence Number: 1
• Publication Date: November 5, 1986
• Content Type: MEMO

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DATE
DOC NO &L'~ /`'l ~~a 3
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Central Intelligence Agency
Washington.D.C.20505
Directorate of Intelligence
5 November 1986
Hungarian Interest in Western-Manufactured Civil Aircraft
SUMMARY
Faced with a fleet of aging
Soviet-manufactured civil aircraft and the
need to conform with stricter aircraft noise
rules in Western Europe by January 1988
Hungary's national airline, MALEV, must soon
update its airfleet or cut back service to
this important market. The unavailability of
suitable replacements from the Soviets for
another six to ten years is forcing MALEV to
look to Western suppliers. The aircraft
Hungary is interested in contains sensitive
navigational and engine technology, but it is
questionable whether the embodied technology
could be exploited for use in military
applications. In any case, less advanced
technology could be substituted in these
aircraft without undermining their ability to
meet Hungary's needs.
This memorandum was requested by Barbara Griffith, Office of
Eastern European and Yugoslavia Affairs, Department of State. It
was prepared by Centraleast European Branch,
Office of European Analysis; International
Transportation Branch, Office of Global Issues; and
Strategic Systems Branch, Office of Scientific and
Weapons Research. Comments and questions are welcome and should
be addressed to Chief, Centraleast European Branch, EURA
25X1
25X1
25X1
25X1
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Hungarian Interests and Motivations
Hungary's national airline, MALEV, has recently approached
Western--including US--corporations about leasing, possibly with
an option to purchase, several short-range passenger aircraft
like the Boeing 737-300
There are several compelling reasons for this interest:
o Malev's fleet of Soviet-manufactured airplanes is rapidly
aging; six of MALEV's ten TU-134 short-range jets are over
15 years old and two are over thirteen. Six of ten TU-154
medium-range jets are over 10 years old, and all four
IL-18 cargo aircraft are beyond the normal retirement age.
o Most West European countries will impose stricter aircraft
noise rules in January 1988 to conform with International
Civil Aviation Organization standards. These new rules
will effectively bar TU-134s and the older TU-154s from
West European airspace.
o A Soviet civil aircraft under development--the TU-204--
will meet the new noise standards and MALEV's need for
short-range jets, but it is not even in prototype form.
We estimate that it will not be available for export until
at least the mid-1990s. Accordingly, if MALEV wishes to
continue aviation service to Western Europe, where all its
hard currency earnings are generated, it must acquire
Western aircraft. Moreover, MALEV officials would like to
expand existing capacity to Western Europe to generate
more hard currency income from western tourists.
o A switch to short-range Western aircraft, which are more
fuel efficient than comparable Soviet jets, would allow
MALEV to reap a savings in fuel consumption and
Although MALEV's needs have been discussed in the Hungarian
press for some time, MALEV has approached discussions on the
acquisition of Western aircraft cautiously, probably because of
hard currency shortages, concern about the possiblity of a future
embargo on spare parts and other support, and Soviet pressure to
keep Eastern Europe a protected export territory for its
L.t1C Llnanclal concerns, any future acquisition of Western
aircraft will probably be restricted to long-term lease-purchase
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Technology Transfer Issues
MALEV's interest in the Boeing 737-300 raises the issue of
technology transfer because it and other comparable aircraft,
like the Airbus A-320 and the McDonnell Douglas MD-80, contain
advanced navigation and flight management systems, including
state-of-the-art ring laser gyro systems. Only France and the
United Kingdom have also developed ring laser gyros suitable for
commercial navigation. West Germany is close to having such a
system, while Israel and Japan are about five years away. The
Soviets also have a significant development program in ring laser
gyros. A Soviet Navy supported program at the Vladikinsky
Mechanical Plant resulted in the serial production of 2,000 ring
laser gyros in 1979. These are, however, believed to be of lower
performance and much more costly than the Honeywell GG 1342 on
board the Boeing 737-300 aircraft.
Although the technology embodied in the ring laser gyro of a
civil aircraft could theorectically be disassembled and adapted
for use in short-range rockets or tactical aircraft, little
technology would actually be lost if Hungary were to buy western
aircraft with this gyro.
o A critical component of the ring laser gyro is a triad of
high quality mirrors, which involve high technology to
produce at a low cost. Use of the ring laser gyro in
civil aviation, however, will not give away the sensitive
processes involved in mirror manufacture.
o The computer technology used in the gyro's electronics is
standard and there is no technology to lose here.
Although the software used in the system is somewhat
sensitive, it would be difficult to decipher the machine
language from a commercial navigational unit.
The only other major concern about technology transfer
centers on engine technology. The standard engine in the Boeing
737-300s, the CFM56-3 built in France by General Electric and
SNECMA, embodies less sensitive technology than the navigational
system, but is still on COCOM's controlled list.
Options
Hungary has limited options for rejuvenating its civil
airfleet because only a few companies sell appropriate
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short-range jets, with the Boeing 737-300, the McDonnell-Douglas
MD-80 or the European Airbus A-320 being the main competitors.
Technology transfer concerns could be addressed by substituting
less advanced navigational systems than the ring laser gyro or
even less sophisticated engines in any of these aircraft. While
substitution could degrade aircraft performance, it would not
interfere with the aircrafts' ability to meet the 1988 noise
standards. From the manufacturers' standpoint, modification of
the aircraft would probably be easier if 20 to 30 such planes
could be sold to Eastern Europe. Poland, Romania, and
Czechoslovakia reportedly also have been considering buying or
leasing western-manufactured aircraft.
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SUBJECT: Hungarian Interest in US-Manufactured Civil Aircraft
Requestor
CPAS/IMC/CB
D/EURA
EURA/PS
DD/EURA
AC/EURA/EE
C/EURA/EE/CE
SOURCING
ORIGINATOR
EURA/EE CHRONO
EURA/EE/CE CHRONO
EURA/EE/CE PRODUCTION
DD/OGI, D/OGI
OGI/EXS/PG
C/OGI/ISID
OGI/ISID/IT (Branch File)
C/TTAC
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