Doctorate under Armstrong and Indian population soon to touch one billion. (100 crores)
Q & A\Dinesh Keshkar
Aiming and Flying High
Boeing India president Dinesh Keshkar is a busy man these days closely tracking the developments in the civil aviation ministry, Indian Airlines and Air India.
The run-up to aircraft sales can be trying . But Keshkar, who, incidentally, did his doctorate under Neil Armstrong, remains confident.
He sees the aviation market in the country as rich, and is optimistic about his company's performance.
In a conversation with Sangita P Menon Malhan, the chief of the global aircraft manuefacturing giant in the country asks about competition with Airbus the civil aviation policy and the domestic market
aviation market?
We have been a part of this for 40 years.
In the last 9-10 years particularly, we have been the dominant player in the Indian market .
All the private carriers are flying only Boeings. The domestic market will grow. The growth rate will certainly depend on several economic factors.
But in India, with population soon to touch one billion, the number of people flying within the country is still only 13-14 million a year, which is very small.
If you look at it, many, of these are repeat passengers.
But the growth rate will come. And this is one of the richer markets to tap besides China.
We are predicting that roughly for the next 20 years, there will be a need for about US$ 20 billion worth of airplanes, that is approximately 275 aircraft. And that includes the 737 types. It is a good market, poised to take-off and it has been good, though growth has not been as much as we would have liked it to be. But it will possibly go up as the economic condition continues to get better.
What prospective sale do you antici pate to the airlines especially Indian
Airlines and Air India?
India has a need for many air
planes. The private airlines are expanding, Both Jet and Sahara fly our planes And even erstwhile airlines like Modiluft, East West and Damania flew Boeings, Coming to Indian Airlines, it is very well known that the airline has an ageing fleet of 737-200s, which have entered service over 20 years, to replace them, we have the 237-600. Boeing 717 is offered as a replacement for the 100-seater. Coming to Air India, evaluation of re- quirements is on. In this regard may I say that airlines have started flying the 777-300. This is an airplane in two classes over close to seats bigger than the 777-200.
AI was looking at this as a 300-seater. Thai Airways and Cathay Pacific are going to soon introduce the 777-300 into the Indian market Perhaps, Air India should take note of that.
The aircraft purchase campaign seems to have shifted from the MCLR to the short-capacity air lplanes at Al. In this context, is there a market in India for such a big airplane esperally keeping Air India's financial situation in mind?
Two things must happen if Al has to remain competitive. It must have a modern fleet, and to compete effectively, have aircraft that meet the cost targets of competitors Faring that, Al will not be able to make money even if it fills its plane to 100 per cent capacity. So it is for that reason that Al must look
at the size of an airplane: the size of a bigger 767 or the smaller 777. If Al flies a bigger plane, it will have the advantage of seat-mile cost. Its cost of operation per passenger will be lower. It will be able to compete. Al has a 747-400 which is the largest airplane anybody flies today. It can compete effectively because there isn't a better airplane.
Does Boeing have plans to help these airlines sell off their old aircraft?
Yes In our old proposal for the 777 that was given to Al in 1995, we offered to buyback the old air planes in return for Air India buying the 777. We know it has to replace the fleet and the airline does not have as much market access as we do.
How will Boeing help these airlines with their finances?
The only airplanes Al ever bought in this decade have been 6 Boeing 747-400s and all of them were financed by the Exim Bank of US. The financing was guaranteed.
Financially, we can assist any airline
Is there any truth in the statement that Boeing aircraft are fuel guzzlers compared to Airbus?
Fuel is an important factor in any competition. If you look at the existence of the Boeing airplane and the fleets of major carriers, you will see that in many places, the product had met that criteria. In the notion of fuel burns, we are head of Airbus. We have far more experience. And far more planes flying in the sky. In fact, several thousand more. There are over 9000 Boeings flying all over the world which is nowhere close to Airbus. We have sold more 717 alone than the entire Airbus fleet put together in the world. So, there is no competition when it comes to delivery. Last year, we delivered 564 airplanes. Airbus probably did not do even half of that. This year, we will deliver 620 airplanes. There is a clear-cut difference between our product line and theirs. Ours starts as low as the 100 seater all the way to the Jumbo. If you look at Airbus range, their smallest air plane is the A-319 which has 126 seats and their biggest today is the A340-300 which has 300 seats.
What happens to your 737s?
Are they being used out?
The 737-200s are very much there. Some have been replaced by the 600/700/800 series. Then, there are cargo markets These airplanes will have a market as long as they make money. They can be converted to freighters.
What do you think of the civil aviation policy? We got so many airplanes into this country under this policy. But world over regularization and privatisation are preferred. US is a great example where the change in the policy of civil aviation led to a huge increase in the fleet sizes and better prices for the consumer.
How do you see domestic traffic in the coming years?
The capacity in the domestic market is coming. There should be a growth rate of 4-5 per cent every year. There is a direct linkage in the market growth for aviation and the GDP growth for the country.
Are you more confident than Airbus about catering to the requirements of Al and IA?
We have a 60 per cent market share. Our product is worldclass We are a 55 billion dollar company, in existence since 1916. And we dominate the Indian skies. Need I say more!?
