Story ID: 507 Aero India Report.doc
India Eyes Offset Components Opportunties
By: Neelam Mathews
Caption: Indian companies are adopting new technologies as they see opportunities to supply the OEMs and first-tier suppliers.
Word Count: 1042
The civil aviation policy promised last year by the new Indian government is stalled, leaving new carriers Vistara and AirAsia India hoping for a relaxation of the rule that mandates a domestic carrier must fly for five years and have a fleet of 20 aircraft before it can fly internationally. There is good news, however, with increasing attention on engineering design services and component manufacture in the commercial and business aviation sector, opening opportunities in this sector.

“Defense offsets in the procurement guidelines can be used in the civil aviation sector. This has the potential to give a major boost to this sector in the country. We are looking at it and will take it forward,” confirmed Ashok Gajapathi Raju, India’s Civil Aviation Minister.

The Indian MRO market was estimated to be worth roughly $800 million in 2011 by consultants Frost & Sullivan, and was to touch $1.5 billion by 2020. This has not taken off because of a high taxation regime and incoherent policy. But component manufacturing is the new mantra.

The appetite for the manufacture of components and design engineering was apparent at the bi-annual Aero India show in Bangalore in February. Already, OEMs Airbus and Boeing have made Indian companies part of their global supply chains.

Airbus awarded its largest manufacturing contract to private sector company Dynamitic Technologies, making it a tier-one sole-source supplier of flap track beams for Airbus A330s. Sikorsky’s S-92 cabins are now solely manufactured in India, as are composite flaperons of Boeing’s 777 series aircraft and front doors for all Airbus single-aisle aircraft.

Aware of the rising trend, state-government enterprise TamilNadu Industrial Development Corporation (TIDCO) in south India has created a special purpose aviation cluster for large enterprises and SMEs exclusively for component manufacturing on a 260-acre site.

The Chennai Aerospace Park is surrounded by a strong industrial belt comprising some 2,000 companies, many automotive-related. Half of the plots have already been sold, B. Elangovan, general manager of TIDCO, told AIN.

“Creating an aerospace ecosystem requires building of different components of the projects and integrating them logically,” added Elangovan. Other related clusters include a 50-acre satellite MRO facility at the Chennai airport and a 3,000-acre site for manufacture and assembly of aircraft. TIDCO is following a novel approach by setting up a common computing and engine design center and testing facility in the aerospace park incentivizing SMEs to set up shop, as “they don’t have to invest much,” said Elangovan.

Venktash Chandrashekharan, chairman and managing director, Vinmn Aerospace, a company with orders in hand for landing gears and engine component manufacture, agrees. “Our 40-acre greenfield facility will be up in two years at a cost of $31 million. Facilities available in the park, along with autoclaves and freezer zones, will help us get competitive as we will not need to make further investment…in the next 10 years, we will be able to compete globally,” he added.

In addition, a common MRO in engine and landing gear test facility is being set up, which will further lower costs. “There will be no need to send our products to Bangalore any more as the facility will be certified,” he added.

Meanwhile, Mumbai-based Max Aerospace Aviation, a joint venture with Air France-KLM for manufacture of components, is planning expansion to increase its production capacity with an additional hangar and aerospace engineering in the special economic zone at Nagpur International Airport. Max Aerospace last October signed a joint-venture agreement with Snecma (Safran, Hall 2a A228) called Max Aero Engines Pvt Ltd. for military aircraft engine MRO services in India.

Also in Nagpur, Boeing recently opened a $100 million, 50-acre facility with two wide-body hangars and a GE90/GEnx engine-overhaul shop. This is part of its offset obligations for a large aircraft deal. The construction of a 1.8-km-long taxiway was carried out by Maharashtra Airport Development.

An area that has not shown development in manufacture in India is airline seats. “It is a competitive business that requires high quality and reliability,” said Boeing senior vice president for Asia Pacific Dinesh Keskar.

Refurbing Interiors

EASA-certified MRO provider Air Works is taking on the challenge of repair of business jet seats, the bulk of work of which is on the woodwork on which veneer gets warped due to heat and pressure, said Vivek Gour, managing director to AIN. “Instead of replacing ripped seats, we specialize in redoing veneer as it is a cheaper solution.”

Refurbishing hydraulic mechanism under seats, replacing carpets, replating fittings such as door handles in toilets are taken on by the company. “Commercial jets by design are more rugged,” said Gour. He accepts there have been very few innovations in cabin design in India since the economy was on the downside for years.

Wi-Fi, for instance, does not come fitted in aircraft due to complex rules in India that technically do not permit the system to be installed in the country. This is expected to change soon. Tata-SIA owned domestic airline Vistara has selected BAE Systems’ IntelliCabin in-flight entertainment (IFE) system, which provides inflight wireless streaming of preloaded content to customers’ personal electronic devices across all cabin classes in its fleet of A320 aircraft. The entire fleet of Vistara will incorporate the IFE system, which is expected to go live later this year.

“IFE has changed the passenger experience in the past four years. Wi-Fi is more reliable and comparatively maintenance-free,” added Keskar.

Innovation by Indian companies in MRO has started. Ramco Systems, a leading enterprise software provider for mobile devices worldwide, recently provided Malaysia Airlines with a suite of solutions that can be installed on site or in the Cloud for maintenance and engineering, procurement, advanced planning and optimization, advanced reliability and loadable software aircraft parts.

Last year it began integrating its Enterprise Resource Planning (ERP) software with wearable devices such as Google Glass and Pebble Watch, enabling aircraft maintenance providers to cut the time taken for repairs. “The Google Glass has heating problems and needs some calibration. But the smartwatch can be a good bet for us,” said CEO Virender Aggarwal.