The article deals with the state of affairs in the Russian machine-building complex. Noted occurring low product quality problems, low innovation activity, high cost of production and lack of efficiency. In this regard, given that the Russian engineering products insufficiently competitive, and its exports account for a small part in the country’s export value. According to the author, the financial policy of Russia in the field of engineering formed from the standpoint of business and not from the point of view of governance, as evidenced by the priorities of funding in the domestic mechanical engineering given in the publication. The retrospective study of changes in the machinery of the Irkutsk region, beginning with the 1990s. It is shown that during the analyzed period, the industry has suffered significant losses. It was determined that in the field of machine-building complex of the number of survivors have formed three main groups of companies: successfully fit into the current realities of the market and confident working; resist in difficult market conditions and steadily increasing production; repeatedly cut production, with few prospects of recovery from the crisis. Named the main obstacles to improving the competitiveness of the Russian mechanical engineering as a whole and the Irkutsk region in particular - a high degree of depreciation of fixed assets, low productivity, high material and energy intensity, lack of modern equipment, inadequate staffing and financial-economic opportunities, etc.. The author formulated proposals that will save the survivors of the enterprise engineering and help them to work steadily - carrying out technological upgrading of enterprises, improving the financing and development of the internal market of engineering products. Presented are two ways to the development of machine-building complex: innovation and energy and raw materials.