labels: Aerospace, Industry - general, News reports
Aerospace outsourcing - the next big boom news
Archana R D
21 February 2005

Tejas lcaAfter courting triumph with BPOs, India is perched to become an answer to the outsourcing hub for global aerospace companies. The Indian advantage being, 'the low-wage-high skills' engineers that it offers.

The fifth annual AERO India 2005 air show that ended on last Sunday at Yelahanka airbase in Karnataka, billed as the largest in South Asia, saw an increase in the number of deals between Indian and foreign aerospace firms. More than 240 civil and military aerospace firms from 31 countries attended the trade fair. The concluding theme of this year's event was the technology and knowledge capital that India offered to the global aerospace industry.

About AERO India 2005
The fifth AERO 2005 expo was held at Air Force Station Yelahanka, Bangalore. The exhibition is organised by the 'defence exhibition organisation' under the 'department of defence production and supplies' of the ministry of defence.

The Indian Air Force base at Yelahanka (AFSY) is a training base for pilots of IAF and the Indian Navy, but its infrastructure and facilities are used for this prestigious air show. Bangalore is fast becoming one of the major international hubs of the aviation and aerospace industry besides the IT sector.

Aerospace bigwigs like Boeing, Airbus, GE Aircraft Engines, Pratt & Whitney, Goodrich and Dunlop has 85 per cent of their turnover coming from oversees business. In 2003, India earned an estimated $2.3 billion from offshore business process outsourcing which was more than 80 per cent share of the global market, according to US-based analyst firm Gartner. The trend of outsourcing is definitely on an upward swing as international companies preen at the best offers in Indian IT market.

Su30mki"Indian aerospace firms are internationally competitive and customer-oriented. As a result the first-tier suppliers look very promising," Edward Gordon, manager, offset programmes, Northrop Grumman, told the media. Northrop was at the show pitching for the sale of its Hawkeye, 'an airborne early warning, command and control aircraft', to India. "Some of companies such as Hindustan Aeronautics have come a long way," he added.

More than 1,400 companies have already set up base in Bangalore, India's technology capital, and international software companies are using India as a base for their outsourcing operations.

BrahmosAt the AERO India 2005, deals ranged from aircraft purchases made by Indian budget carriers with Airbus and Boeing to joint manufacture of missiles and engine parts.

Deals @ AERO India 2005

  • US aviation major, Boeing Corp tied up with India's HCL Technologies to develop a platform for the flight test system of its Dreamliner aircraft.
  • Boeing has also offered to sell its F-18 jets. The company has also signed a $1.26- billion order to sell 20 passenger jets to SpiceJet airline.
  • US-based Lockheed Martin and Hindustan Aeronautics Ltd (HAL) have signed a technical assistance agreement relating to the P-3 Orion maritime surveillance aircraft programme. This will allow the two companies to share export-controlled technical data related to P-3 airframe component design, manufacturing and overhaul.
  • France's Snecma told the media that it is planning a 50-50 joint venture with HAL to make engine parts.
  • Israel's defence industry also made its mark with a set of new deals, details of which are not disclosed as yet. It is estimated that Israel's defence industry sold arms and ammunitions to India valued at $2.7 billion in 2003, which constituted almost 30 per cent of Israel's total orders.
  • Asian software major Tata Consultancy Services, Ltd. (TCS), in association with the National Aerospace Laboratories (NAL), has launched Flosolver Mk6, proved over a wide variety of aerospace applications. This 32-bit parallel computing machine on a Linux platform as a substitute for expensive supercomputers. The TCS-NAL alliance will guarantee maintenance, warranty, and string technical support.
  • HAL bagged a deal for making doors for Boeings and renewed a similar contract with Airbus.
  • European firm Avions de Transport Regional (ATR) announced its intentions to set up a maintenance and logistics centre in India.
  • French aviation group Dassault Aviation noted the 'great potential for the sale of its business jets' in India. Dassault's Jaguar aircraft is currently produced by HAL under licence. The firm has its Mirage 2000 fighter planes serving with the Indian Air Force.
  • Indian Air Force declared its intention to buy 126 supersonic fighters worth at least $12 billion dollars, to replace its ageing MiG fleet.
  • After a long negotiation that began in March last year, the Hawk trainer jet is finally arriving. Twenty-two Hawks will be flown in from British Aerospace Services' (BAe) manufacturing facility in East Yorkshire (seven are already on the production line). Another 44 will be made by HAL in Bangalore.

Joseph Ralston, former joint chief of staff of the US Air Force, was quoted by the media as saying that America sees the 'Indian defence sector not only as a market but also as a potential supplier and partner'.

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Aerospace outsourcing - the next big boom