Friday, 10 May 2013

Avro replacement transport aircraft: Rs 28,000 crore IAF order up for grabs

The Antonov AN-148, which the IAF is eyeing, along with others like the EADS Casa C-295 and Alenia Aeromacchi's C-27J Spartan

By Ajai Shukla
Business Standard, 10th May 13

The defence ministry (MoD) today issued a Request for Proposals (RfP) to eight foreign aerospace vendors, inviting tenders for co-producing 56 medium transport aircraft to replace the Indian Air Force’s (IAF’s) aging fleet of Hawker Siddeley 748M Avro aircraft. The deal could be worth about Rs 28,000 crore.

The proposal requires the vendor to deliver 16 aircraft in flyaway condition and build 40 in facilities to be established with an Indian partner that it can choose. This proposal has been driven by the IAF, which wants to wean itself off a crippling dependency on the public sector Hindustan Aeronautics Ltd (HAL). While HAL has licence-produced a series of fighter aircraft for the IAF, including the high-end Sukhoi-30MKI, it has been afflicted with serious time and cost overruns and charged with sub-quality manufacture.

Amongst the companies invited to bid are Boeing of the US, Ilyushin of Russia, Antonov of Ukraine, Franco-German consortium EADS and Alenia Aeromacchi of Italy. The MoD has given bidders five months to choose and tie-up partnerships with an Indian Production Agency (IPA) and submit their “techno-commercial proposals.”

Air Chief Marshal NAK Browne, the IAF chief, has strongly backed this project, hoping that it will create a badly needed aerospace manufacture eco-system within the private sector.

At a lecture organized by CII in New Delhi on Sept 01, 2011, Browne told the private sector, “Once you start licensed production in partnership with a foreign partner, you will develop a basic aerospace eco-system: the R&D, the jigs, tools and expertise that would work for the entire country.”

The MoD said today that this deal “ensures inflow of Production Technology to the IPA in phases wherein the value addition in the manufacture by the IPA will gradually increase from 30% to 60%. The IPA will also obtain the Transfer of Technology for Maintenance (MToT) which will enable the IPA to provide life time product support and maintenance up to Depot level (sic).”

The Indian partner will be selected by the foreign vendor based on a set of criteria that are specified in the RfP. These exclude small and medium companies and those that have not been consistently profitable. It is learnt that Reliance Industries’ aerospace venture; Larsen & Toubro; and a Tata Group company.

HAL has staunchly opposed this arrangement, lobbying with the MoD to build the 56 Avro-replacement transport aircraft at HAL Kanpur, where the Dornier 228 aircraft is currently built.

Contacted for a comment, HAL has not responded.

The CEO of a reputed private sector defence company says that the number of aircraft to be built in India --- just 40 --- is too low to repay the investment that will be required to set up an assembly line and the flight infrastructure that would be needed.

However the MoD is looking at requirements beyond the IAF’s. Today it said, “The replacement for the Avro aircraft will have extensive requirements even in the rapidly expanding civil aviation sector, especially for flights between growing regional cities. Such combined requirements of IAF and the civil sector will provide large production orders.”

The IAF fleet of some thirty 748M Avro twin-engine aircraft, which is now over forty years old, was built under licence by HAL. The replacement aircraft now being built will have a payload of 6-8 tonnes (the Avro carried 5 tonnes); a cruising speed of 800 kmph (the Avro flew at 450 kmph); and a range of 2,500-2,700 km (the Avro's was 1,700 km).


Anonymous said...

The clash is going to be mainly between C-27J Spartans and EAD's C-295 ??? and, with the similarity of electronics/other systems/engines with the C-130J's.........and that it has a wider cargo hold...........guess the C-27J's will make more sense (unless they get blacklisted for the AW101 deal!!)......

Kana said...

The only contender who actually has a regional airliner product in that list is Antonov. None of the turboprops would have a chance of meeting the speed requirement as-is. How can this even be a competition with those requirements?

What is Boeing offering anyways? Or are they actually partnering with another company like BAE or Embraer?

Strange not to mention in the context of applications for the platform beyond IAF, that C-295 is being offered for IN's MPA. Such roles, as well as AEW&C should be potential applications, as well.

The Ilyushin product would presumably be the paper Il-112, so far passed over by Russia for An-148, but possibly that ship hasn't sailed so far that Russia would not resuscitate Il-112? Or simply let an Indian company take the design over (thru JV)?

Anonymous said...

Wouldn't it come as the last nail in the NAL's RTA-project..?!

With a proven foreign aircraft dominating the Indian military & civil aviation market.. would there be any real need for the RTA then??!

Anonymous said...

what about UAC/HAL Il-214 Multirole Transport Aircraft (MTA???it will cost half and its bigger

Stranger said...

I do not know who the main contenders in the bid are going to be but I think that the Indian Private Sector should grab this opportunity as a "foot in the door". Something is better than nothing and with performance they will be able to convince the MoD of its choice. It is never a good idea to have a dependency only on one agency like HAL. The country needs to grow and one agency monopoly is not the way to grow. Secondly, private sector should also think that an investment from their end is required if they are to be of consideration in the long run - always to start with first looking at the bottom line is not a good idea.

Rahul said...

Selected Indian company would come up as great asset in productionising NAL SARAS and RTA.

I hope Indian inc. sees this meager order of 40 aircraft as gate breaking opportunity than just an small order.

Upon successful completion, the follow on projects could bring huge and continuous fortunes for selected company as it would be first to stand parallel to HAL.

Anonymous said...

I would like to compliment the MoD as well as IAF to take this path breaking step. While this would energize and encourage the private industry to invest in Military aviation sector in India, it will give freedom to OEMs to choose partners which follow corporate culture,know value for money & time and deliver a quality product.

While IAF will get a operationally proven aircraft in time, it would force HAL to introspect and transform itself to meet Customer expectations and do not impose itself on it.
Indian private sector must not shy away but grab this unique opportunity with both hands, After all by the time these aircraft enter service, the AN-32s will be due for replacement and hence the number should become much larger to make a business case in long term.

Anonymous said...

Can you provide a link to the RFP please?

Kana said...

The stated terms are confusing, but I believe the terms as a whole make more sense considering that ATR (which is the sole vehicle both Alenia and EADS have for passenger turboprops, shared between them) is beginning planning of a new 90 passenger turboprop. In that light, whichever of C-295 or C-27J is selected probably makes little difference re: future passenger liner participation since both companies have equal share in ATR.

Limited localized production of the LIGHT ;-) transport aircraft is set up synergistically with design/production capacity for a new (not-yet-existing) passenger turboprop (and/or possibly currently existing smaller existing models), although this would almost certainly not be production of the full model but part of it, as is done in modern advanced airliners (787 US/Italy/Japan, CSeries Canada/N.Ireland).

Russia has also been interested in engaging with the civil turboprop market, and it's so-far paper Il-112 design could provide the basis of the military airlifter version while a civil-optimized version sharing some components could be developed for passengerliner market, essentially a similar relationship of the Mitsubishi C-X/P-X. A different wing can be done if both turboprop and jets are desired, but it seems like the desire of jet-speed is less likely to be requirement for the military transport than a perception of 'high end' status in civilian passengerliners... A perception which is fairly ridiculous, what matters is the market for each, and turboprops are superior on many routes, and ATR in fact wants to go 'upmarket' with a larger 90 seat turboprop.

aditya said...

antonov an-148 cost $18-24 dollars(2012).
cost for 56 = 1.34 billion $.
production line,tot etc...est total cost 2 billion $.
even 2.5 billion $ is reasonable.
28000 crores rs is more than 5 fucking billion dollars????
goi funding for rigional jet - less than .06 billion$(300 crores)