[Batfreak]

Very interesting opinions and discussion, so thanks to all the contributors so far.

I have a (perhaps noobish) question that I was hoping the more experienced members could help address - Generally, we see an effort from airlines to homogenize their fleets (between plane types, engine options and airframe manufacturers). This helps in reducing the cost of re-training pilots for type approval ratings as well as optimizing the ground (MRO) operations. The most famous example of which, of course, is Ryanair, with their B737 heavy fleet.

However, in this deal, there has been a conscious effort to diversify both, the airframe manufacturers (split between Airbus and Boeing) and the engine options (GE and RR), which must lead to higher costs. I was wondering why that might be the preferred strategy (instead of, for instance, a Boeing/Airbus only or GE/RR only deal). Is this because of synergies with the larger Star Alliance group or because of other reasons?

[msa.30789]

Originally Posted by Batfreak

Very interesting opinions and discussion, so thanks to all the contributors so far.

I have a (perhaps noobish) question that I was hoping the more experienced members could help address - Generally, we see an effort from airlines to homogenize their fleets (between plane types, engine options and airframe manufacturers). This helps in reducing the cost of re-training pilots for type approval ratings as well as optimizing the ground (MRO) operations. The most famous example of which, of course, is Ryanair, with their B737 heavy fleet.

However, in this deal, there has been a conscious effort to diversify both, the airframe manufacturers (split between Airbus and Boeing) and the engine options (GE and RR), which must lead to higher costs. I was wondering why that might be the preferred strategy (instead of, for instance, a Boeing/Airbus only or GE/RR only deal). Is this because of synergies with the larger Star Alliance group or because of other reasons?

Synergy is followed here very well. If i am not wrong, the full service carrier Air India will use all of the Airbus fleet of A320, A350 and the boeing widebody family of B777 and 787 while the low cost carrier Air India Xpress will use the boeing narrow body B737 Max family. Another reason to divide between these manufacturers is to have quicker delivery. It will take almost a decade to deliver 400 odd narrow body aircrafts, both of which are having high order backlogs. The backlog is so huge that delivery from Indigo's order book of 250 A320neo family aircrafts in the year 2015 are still pending

[dragracer567]

Originally Posted by sagsaw

I was looking for some fine grained data as I am not too much into aviation sector.

We as an economy have always been booming but data should also indicate it.

Else companies taking on debt for CAPEX and then the OPEX n revenues just dont keep up with the returns required.

Ultimately banks also are involved and its our money in those banks there.

100 billion dollars of order value of 500 planes is both Euphoric and similarly scary.

Hi Sagsaw, your views may or may not be true. But in my opinion, it doesn't matter because Air India is no longer funded by the taxpayers. If this investment doesn't pay out, the result will be borne by the Tata group and its shareholders, not the exchequer. It's the free market now, one player fails, then another will rise up as we've seen with the failures of Jet and Kingfisher.

If you disagree, you are free to put your savings in a bank that hasn't provided significant debt to the Tata group and you are also free to sell any Tata stock you hold if you feel that this decision will lead to a failure.

We Indians always seem intimidated by big numbers, we are a big country with a small country complex.

[KANNURAN]

This is great news for Indian Aviation. But what wowed me more is the news stories doing the rounds, of the possible local manufacture of the Sukhoi Superjet regional jet, the larger Irkut MC-21 and the Ilyushin IL-114 turboprop.

If we are able to start with local assembly and climb up the value-chain, these aircraft can be in the skies at 30 - 40% lower capex than comparable Western ones. Greater domain familiarity can help us spawn a Brazilian Embraer or a Chinese Comac.

Jet travel is set to grow dramatically and we need to be in the manufacturing side of the business, not just signing cheques for big aircraft orders

The fly in the ointment though, is the embargo on Russia and the switch to Russian engines and key components.

[V.Narayan]

Originally Posted by dragracer567

Hi Sagsaw, your views may or may not be true. But in my opinion, it doesn't matter because Air India is no longer funded by the taxpayers. If this investment doesn't pay out, the result will be borne by the Tata group and its shareholders, not the exchequer.
If you disagree, you are free to put your savings in a bank that hasn't provided significant debt to the Tata group and you are also free to sell any Tata stock you hold if you feel that this decision will lead to a failure.
We Indians always seem intimidated by big numbers, we are a big country with a small country complex.

Thank you for saying it like it is.

Originally Posted by Batfreak

I have a (perhaps noobish) question that I was hoping the more experienced members could help address - Generally, we see an effort from airlines to homogenize their fleets (between plane types, engine options and airframe manufacturers). This helps in reducing the cost of re-training pilots for type approval ratings as well as optimizing the ground (MRO) operations. The most famous example of which, of course, is Ryanair, with their B737 heavy fleet.
However, in this deal, there has been a conscious effort to diversify both, the airframe manufacturers (split between Airbus and Boeing) and the engine options (GE and RR), which must lead to higher costs. I was wondering why that might be the preferred strategy (instead of, for instance, a Boeing/Airbus only or GE/RR only deal). Is this because of synergies with the larger Star Alliance group or because of other reasons?

Good question and a valid one. The root cause is need to economically cater to many ranges & capacities. Air India, like Lufthansa or United Airlines, needs to fly across long range, super long range, medium range, short range and at some point soon regional commuter ranges too. It needs for example aircraft that can economically fly long and heavy routes as well as those that can do long and thin routes; those that can carry a medium payload over 8 cycles a day year in and year out versus those that can carry a medium payload 10,000 kms non-stop and so on.

Ryan Air and other regional airlines manage to stick to one aircraft type because they largely stay within a geography for 90% of their revenues - Europe and its adjacencies in this case. But if Ryan decides to fly London - Tokyo the 737 won't do. You are right that multiplicity of types adds layers of cost on training, spares etc.

Hope this helps.

Originally Posted by KANNURAN

This is great news for Indian Aviation. But what wowed me more is the news stories doing the rounds, of the possible local manufacture of the Sukhoi Superjet regional jet, the larger Irkut MC-21 and the Ilyushin IL-114 turboprop.
If we are able to start with local assembly and climb up the value-chain, these aircraft can be in the skies at 30 - 40% lower capex than comparable Western ones.

In my heart I have a soft spot for Russian aircraft and am nostalgic about the bygone days of our strategic friendship. But having dealt with the Sukhoi Super Jet at first hand I wouldn't recommend Russian civil airliners for local assembly or even purchase. Not only are the flight safety standards lower the economics are too and the old Soviet eco system of spares is in shambles from three decades of decline. Alas. Airbus, Boeing, Embraer through a grinding system of incremental improvements have taken civil airliner design to the peak of mechanical & electronic engineering. When you open up these machines for overhaul you get to marvel at the sheer thought that has gone into their design - not just for functioning but reliability, repairability, redundancy etc too.

[d.w.w.]

Originally Posted by V.Narayan

Thank you for saying it like it is.

Ryan Air and other regional airlines manage to stick to one aircraft type because they largely stay within a geography for 90% of their revenues - Europe and its adjacencies in this case. But if Ryan decides to fly London - Tokyo the 737 won't do. You are right that multiplicity of types adds layers of cost on training, spares etc.

There is one more point to add here - the software costs(flight scheduling/ load planning to name a few). Airlines choose software based on their needs and they will pick software which supports only Boeing/Airbus fleet during their initial days. When the company grows, to reduce the software costs, they begin sticking to a particular fleet/manufacturer to cut down the software costs.

[porsche_guy]

Originally Posted by V.Narayan

Good question and a valid one. The root cause is need to economically cater to many ranges & capacities. Air India, like Lufthansa or United Airlines, needs to fly across long range, super long range, medium range, short range and at some point soon regional commuter ranges too. It needs for example aircraft that can economically fly long and heavy routes as well as those that can do long and thin routes; those that can carry a medium payload over 8 cycles a day year in and year out versus those that can carry a medium payload 10,000 kms non-stop and so on.

Ryan Air and other regional airlines manage to stick to one aircraft type because they largely stay within a geography for 90% of their revenues - Europe and its adjacencies in this case. But if Ryan decides to fly London - Tokyo the 737 won't do. You are right that multiplicity of types adds layers of cost on training, spares etc.

Great answer sir, but if I may I still have some doubts over this strategy. Firstly, as you said a mix for long and thin as well as long and dense routes necessitates different aircraft- I believe the 787 is perfect catering to the thinner routes and it will synergize with the existing fleet well along with Vistara's order. Similarly, the A350 can cater to the super long haul and heavy routes. However, what will be the use case for the 777X? The current fleet is already ageing (except the ex-Delta aircraft leased recently which can be returned) and I would think it makes no sense to have them (A350 and 777X) together.

As for AIX, I don't understand why under the previous ownership were the 737s acquired at all when AI has been using 320s since a lot of time. It would have added unnecessary complexity and prevented interchangeability of aircrafts with those of AI. While I do understand that the decision to continue with them for Tatas might be governed by the painfully long wait times for the A320 family, it seems like a penny wise pound foolish move with a short sighted approach. And amongst all this where does the fully-Airbus Air Asia fleet come to be since that's also going to be with merged with AIX.

I am sort of an amateur in this field so pardon if any of my queries seem silly, but I had genuine doubts.

Thanks

[Gansan]

^^Geopolitics also will play a role in large aircraft orders. We can't please one and displease the other when powerful economies are involved. Even though the entities placing the orders are companies, the government may gently nudge them in that direction. Such large orders are bargaining tools.

[ads11]

Originally Posted by dragracer567

Air India did fly the LHR-CCU route during COVID which was at the time, the first direct connection between CCU and Europe after a really long time. Air India currently connects LHR to Hyderabad, Kochi, Ahmedabad, Amritsar and Goa (apart from Mumbai and Delhi) though these flights will shift to Gatwick from March. Calcutta has to be one of the most comically underserved airports for a major metro city in India, I hope the re-invigoration of Air India changes this. Its strange that Chennai and Bangalore isn't connected by Air India to London though British Airways does provide direct flights. I do see MAA slowly declining as well in a similar vein to CCU, as early as 6-7 years ago, MAA had more international flights than Bangalore but no longer the case - showcased by the fact the Blue-Dart/DHL moved their base from Chennai to Bangalore.

Yeah I was able to take that direct LHR-CCU flight just the once. It had absolutely excellent timings but alas, we can't have nice things.

I'm with you on that one, it baffles me how few options there are into CCU. As a child I remember us taking all sorts of weird and wonderful airlines into the city.

As for Chennai airport losing out to Bangalore, I can only speak from personal experience dating back to the 2015 floods but the attitude of the staff there was diabolical. It's left a sour taste in my mouth to this day. In comparison when we eventually made it to Bangalore airport, it was a sea change in experience in terms of airport staff being wonderfully proactive. I've not had a chance to be back to either since but given my dismal experience at MAA I'm not surprised by the trajectory you paint.

Originally Posted by V.Narayan

In my heart I have a soft spot for Russian aircraft and am nostalgic about the bygone days of our strategic friendship. But having dealt with the Sukhoi Super Jet at first hand I wouldn't recommend Russian civil airliners for local assembly or even purchase. Not only are the flight safety standards lower the economics are too and the old Soviet eco system of spares is in shambles from three decades of decline. Alas. Airbus, Boeing, Embraer through a grinding system of incremental improvements have taken civil airliner design to the peak of mechanical & electronic engineering. When you open up these machines for overhaul you get to marvel at the sheer thought that has gone into their design - not just for functioning but reliability, repairability, redundancy etc too.

As an aviation enthusiast I'd love to see more variety in the civil aviation sphere. I'm glad the Super Jet and the Irkut MC-21 exist. However I do remember there being a few incidents with the Sukhoi in particular, I think one caught fire at Sheremetyevo. I think the Comac C919 has a vastly more realistic chance of making a dent in the global aviation market if only through Chinese domestic orders alone.

I second Gansan - the fact Macron and Biden were involved in the pronouncements of both deals alongside Modi is sign enough that there's a diplomatic quotient to this order. Probably not the primary motivation, I think the point about delivery slots is a real and much more pressing concern in terms of the split order.

I wonder if Embraer must be ruing a chance to get a similar sizeable regional jet order too. I am surprised not to see the A220 get any orders - I would've thought it would be an ideal option for some of the Tier 3 and 4 city airports under the Udaan scheme?

[dragracer567]

Originally Posted by ads11

As for Chennai airport losing out to Bangalore, I can only speak from personal experience dating back to the 2015 floods but the attitude of the staff there was diabolical. It's left a sour taste in my mouth to this day. In comparison when we eventually made it to Bangalore airport, it was a sea change in experience in terms of airport staff being wonderfully proactive. I've not had a chance to be back to either since but given my dismal experience at MAA I'm not surprised by the trajectory you paint.

There is a simple explanation for this IMHO. MAA is operated by AAI while BLR is operated by a public-private consortium.

The long overdue privatisation is apparently confirmed, hope this changes things.

[ads11]

Originally Posted by dragracer567

There is a simple explanation for this IMHO. MAA is operated by AAI while BLR is operated by a public-private consortium.

The long overdue privatisation is apparently confirmed, hope this changes things.

Oh yeah this was immediately apparent at the time from the chalk and cheese experiences between the two. Hopefully MAA improves as well then. I might consider flying back in through there if so.
I did see that BLR has a gorgeous new terminal they've recently opened. Really pleasing to see such great airport infrastructure being opened in the country.

[GrammarNazi]

North American airliners will not be able to fly over the shortest route over Russia to India, for the foreseeable future. Air India can, which gives it a clear advantage.

Record number of the richest Indians have been immigrating for permanent residency in America, especially over the past decade.

This route is going to contribute to the viability of this fleet to a small yet significant extent.

That such a big deal worth lakhs of crores couldn't be done by bringing jobs to Indians is truly sad, especially given the desparate need to encourage job creation within India.

I'm sure there are experts here who can clarify more accurately on this, or point out the way such deals work.

[shortbread]

Originally Posted by KANNURAN

This is great news for Indian Aviation. But what wowed me more is the news stories doing the rounds, of the possible local manufacture of the Sukhoi Superjet regional jet, the larger Irkut MC-21 and the Ilyushin IL-114 turboprop.

If we are able to start with local assembly and climb up the value-chain, these aircraft can be in the skies at 30 - 40% lower capex than comparable Western ones. Greater domain familiarity can help us spawn a Brazilian Embraer or a Chinese Comac.

Jet travel is set to grow dramatically and we need to be in the manufacturing side of the business, not just signing cheques for big aircraft orders

The fly in the ointment though, is the embargo on Russia and the switch to Russian engines and key components.

The issue with the Russians of late is that they promise the world when promoting a deal and post handshake are found wanting, or so I feel. Plus as you already mentioned every part of the Russian enterprise is blacklisted by the West. These planes cannot fly if completely boycotted by the Western supply chain, so its a no go area.

I think we can take a leaf out of Tata groups strategy for it's first indigenous jet, wherein they brought the intellectual property rights for the Grob G180 corporate jet after the company went bankrupt. I would rather a private domestic player similarly acquire ToT/manufacturing license for currently underfunded or discontinued passenger airline projects, and I think there are quite a few out there, for eg:

- Mitsubishi SpaceJet, JAPAN: Has been in development for 15+ years and had its maiden flight in 2015. 4 prototypes had been built and thousands of flight hours recorded while ironing out niggles. Its a 70+ seater single aisle aircraft powered by two turbo fans. Mitsubishi pulled the plug this year as budgets had to be slashed and management were tired of delays in getting it certified.


- Fairchild Dornier 728, GERMANY: Completed advanced stages of development for a family of aircraft that would have seated between 50 and 110 passengers. First one was assembled in 2002, a total of 3 prototypes were built. The promising project was terminated after the company Fairchild Dornier was rendered insolvent. The company had 125 firm orders for the aircraft at the time of project termination.


- Piaggio P1XX - Design readied but none built, project was a victim of the last financial crisis.

- Many of the South East Asian bloc incl. Indonesia, Malaysia had their own attempts at various stages of incompletion.

These attempts teach us two valuable lessons. ONE, this is a very complex, time consuming and extremely expensive undertaking. The govt. should think a hundred times before signing of any such exciting public sector proposals. TWO, why build from scratch when one can try and complete these half done puzzles. Its a wise man who learns from others mistakes.

Nonetheless, I completely agree with the size and potential of our domestic aviation sector alone, India is ripe to start making its own passenger planes.

[Jeroen]

Originally Posted by shortbread

Nonetheless, I completely agree with the size and potential of our domestic aviation sector alone, India is ripe to start making its own passenger planes.

Just as a reference; there are really no countries in the world that make their own airplanes, certainly not commercial jet airliners.

Boeings doesn’t produce any airplanes. They design them, with a lot of outsourcing and contracting to other, and they do the assembly in the USA. But many parts of a modern Boeing come from all over the world.

E.g. have a look at the Boeing 787



I am not sure how India, or any other nation would go about producing its own civil aircraf? The engines alone is a huge undertaking. Civil aviation, from design, to production, to operation is a global industry. Virtually nobody can do it all by themselves.

Jeroen

[ads11]

To further add to what Jeroen said, I don't think it's as easy as people think to have a civilian airliner made domestically. Just think about it, countries have come up with their own space programs and yet they haven't been able to crack the civil airline market with a jet of their own (eg, China, Japan, India, Russia, etc etc).

When you think about a clean sheet civil airliner, the complexity comes not just from designing the airframe, coming up with your own engine, but just think about the hundreds of regulations you have to comply to, to get your aircraft allowed to be flown into various countries. It's not as cut and dry once you think about that safety and regulatory framework you have to handle. We're on a car forum and you think, why does it take billions to develop a new platform? Well, the moment you have to have something that works all over the planet, all types of weather, and satisfies the regulatory folks in all the target markets, you start to realise the bill adds up and it adds up fast.

Look at the COMAC eg. Only with the vast financial backing and shall we say state sponsored industrial effort (including espionage) as part of a CPC directive, do you have the Chinese finally starting to make small headway with their narrow body C919. And even then, like Jeroen pointed out, you just can't do everything yourself. A lot of the subsystems are imported, of Western design and global provenance.

Similarly look at the eg of the Russian jets, the Irkut MC-21 or the Sukhoi Super Jet. IIRC both had a considerable proportion (probably 50% or so) of imported Western subsystems. Without those they're essentially useless.

I think India needs to pick and choose it's battles and getting into the civil airliner game is something other countries have tried and failed (I was wondering if Mitsubishi were still soldiering on with their regional jet, now I know they've thrown in the towel). A good compromise would be some sort of domestic assembly and maintenance network. If Airbus or Boeing built a facility that not only helped meet domestic needs but could act as a service hub in the region, I'd say that's an enormous win.

PS: Jeroen is right as well about Boeing outsourcing so much to contractors with their planes. The reverse takeover by Mcdonnell Douglas, and their GE style management philosophy compared to the engineering led management of Boeing of yesteryear meant the new suits instantly started to look for ways to get rid of costs in house. Their solution was to contract out vast chunks of the work. There's tons written about this loss of the Boeing way in the aftermath of the MAX disasters. I can't remember if it was the 777 or not but the 787 was the first clean sheet Boeing built by entirely this new standard of using many outside contractors for components. I think a former engineer from the heydays wryly quipped in an interview I saw once that Boeing is now no more than an integrator instead of a farm to table aircraft manufacturer.