Sole bidder Tata-Airbus JV far from bagging Avro aircraft deal

[CONNAN]

The Tata-Airbus joint venture for manufacturing 56 Avro aircraft for the Indian Air force is still far from getting the defence ministry’s green signal.

Says air Chief Marshal Arup Raha, “The defence minister (Manohar Parrikar) had ordered a study seeking more details on the project. The study is almost complete and the report is expected to reach the ministry.”

Only when the ministry goes through the findings, will a decision be taken, Raha adds.

A decision on the matter was to be taken at the Defence acquisition Council (DAC) meeting earlier this month, which was postponed.

In May 2013, the ministry had issued a global request for proposals (RFP) for original equipment manufacturers (OEMs), including US firms Boeing and Lockheed Martin, European multinational Airbus Defence and Space and Antonov of Ukraine, among others. Under the RfP, the OEMs were required to tie up with an Indian private company. Forty aircraft were supposed to be made here while 16 were to be bought off the shelf.

However, only one player — the Airbus Defence and Space and Tata Advanced Systems (TASL) consortium — bid in October last year. Under defence procurement policy – 2013, a single vendor is not entertained unless cleared by the DAC.

A decision on the matter was expected to be taken by the ministry last November, but it was delayed as Parrikar had sought more information.
Sources in the defence ministry say a decision could be taken soon. One of the options — apart from selecting the consortium — is to go in for re-tendering, in which Indian companies become the main player. Another option is to put the project on hold and go ahead with joint development and production of the ‘Multi-role Transport Aircraft’ with Russia.

Either way, the MoD is being cautious in not rushing into a deal.

Sole bidder Tata-Airbus JV far from bagging Avro aircraft deal | The Financial Express

 

[CONNAN]

Would be a shame if Avro replacement proj is delayed: Airbus

With no decision in sight yet over the Airbus-Tata consortium's bid to replace IAF's ageing fleet of 56 Avro aircraft with C-295 transport carriers, the European aviation major today said it would be a "shame" if the project is delayed further.

Terming the bid of C-295 as an "elegant opportunity" for the government's push for 'Make in India', Airbus said they cannot be faulted for being the only bidder.

"It is a very elegant opportunity to move forward with Make in India and it would really a shame if we delay it for any reason precisely at a time when that is so high on nation's agenda," Kieran Daly, spokesperson of Airbus' Military aircraft, told PTI.

He was replying to a question if the delay works against the concept of 'Make in India'.

Daly said he understands that there is a discussion about moving ahead when Airbus-TATA are effectively the sole bidder.

"We understand the concern about that but we have pointed out that although we are the sole bidder now, we were not the sole candidate at the beginning. There were other aircraft in that class. The fact that other companies did not chose to be in, we cannot be faulted for that," he said.

The senior Airbus official said the company had "enormously incentivised" to be competitive, because at the time when they submitted the bid, the company did not think they would become the sole bidder.

"So it has been very competitive from day one," he said, adding that Airbus wants India as a strategic market and partner for years to come.

In May 2013, the Ministry had issued a global tender -- called a Request For Proposals (RFP) -- to original equipment manufacturers including US firms Boeing and Lockheed Martin, European multinational Airbus Defence and Space, and Antonov of Ukraine among others.

They were required to tie-up with an Indian private company under which 40 aircraft will be produced here while 16 will be bought off-the-shelf.

However, only a single bidder -- Airbus Defence and Space and Tata Advanced Systems Ltd (TASL) consortium -- had bid for the proposal in October last year.

Under the current defence procurement policy, single- vendor situation is not entertained unless cleared by the Defence Acquisition Council (DAC).

A decision to this effect was expected to be taken by the Ministry in November last but was delayed as Defence Minister Manohar Parrikar had sought more information.

The defence sources said a decision could be taken soon.

One of the options, besides selecting the consortium, is to go in for re-tendering in which the Indian companies become the main player rather than the foreign ones.

Another option is putting the project on hold and go ahead with the joint development and production of 'Multi-role Transport Aircraft' with Russia, defence analysts said.

Asked about the possibility of retendering, Daly said, "We are not going to tell India how to run its procurements.

If that was the solution, then so be it. We are comfortable that C-295 is the ideal for replacing the Avro.

He said the aircraft last year had 85 per cent market share.

"And there is a reason for that. Because it is far by the most attractive (in terms of cost, capability and life coast) airplane if you are looking at that class of aircraft".

Would be a shame if Avro replacement proj is delayed: Airbus | Latest News & Updates at Daily News & Analysis