Logistics

Airbus sees huge opportunity for wide-body aircraft in India

Forum Gandhi | | Updated on: Jul 16, 2021

India can be turned into a thriving international air travel hub, says Remi Maillard

Airbus India is looking to ramp up its market share in the wide-body aircraft in India as Indian airlines look to increase international routes, according to Airbus India Managing Director Remi Maillard

“The pandemic has altered the nature of our business in many ways and has offered an opportunity to refocus our efforts on turning India into a thriving international air travel hub. Today, out of the international air traffic to India, only 36 per cent goes to Indian carriers, meaning time is right for Indian carriers to rescale their operations and gain control of the international network out of India. We see a tremendous widebody market opportunity in India,” Maillard told BusinessLine.

Until now, Boeing has cornered a larger share of the wide-body market. Maillard believes that the wide-body market has not taken off yet in India. “The proportion of wide-body aircraft flying with Indian airlines is remarkably small. India still has today about 1/10th of the wide-body fleet installed in similarly populated regions of the world like China,” he said.

“Just look at the number of foreign domiciled widebodies serving India every day - a profitable market Indian carriers could compete for. Air travellers are also adapting to the Covid crisis, with a demonstrated preference for flying non-stop,” he said.

The main reason for the low penetration of widebody aircraft in India is the lack of the right twin-aisle aircraft in the past and, to some extent, the limited presence of Indian airline operators on international routes. “We have now brought to the market future-looking capabilities with the newest integrated family of wide-body aircraft on the market, namely the A330neo and the A350. It is the most efficient fleet choice available today designed to fit any airline business needs. Our widebody product line features the lowest fuel burn performance, unbeatable unit costs and the greatest range capability making it the perfect fit for the needs of the Indian market. We strongly believe that long-haul operations supported by Airbus wide-body aircraft are a strategic enabler for Indian airlines to grow in a profitable way, to diversify their operations and to become more resilient,” he said.

Airbus delivered 566 aircraft in total in 2020, and it is targeting around the same number in 2021. In 2020, India received more than 10 per cent of all Airbus deliveries.

“Despite the challenges, the outlook for Indian aviation remains promising. There are clear signs of strong pent-up demand for travel. We can feel a strong appetite to fly. We see a meaningful recovery in domestic demand linked with the vaccination programme and the easing of travel restrictions,” Maillard said.

Another segment Maillard sees potential is the helicopter segment. Today, this segment is very small in the Indian aviation industry. He said that the government needs to free up the helicopter space and rework the Regional Connectivity Scheme to include single-engine helicopters.

He further added that there is a lot of potentials for the MRO business to grow in India. Today, India loses at least 80 per cent of the MRO money to the Middle East and other competitors. This also makes servicing of the aircraft expensive, too.

While the government has taken major steps towards tax reforms for the sector, some actions remain to be taken, “such as exemption of GST on parts imported for the aviation sector and rationalisation of DGCA fee structure for MRO. If we are able to sort these out then there is nothing to stop a significant growth of MRO business in India.”

Published on July 16, 2021
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