Boeing looks at Delhi, Kerala for repairs unit

US aircraft maker Boeing has shortlisted New Delhi and Thiruvananthapuram for setting up a $100 million maintenance repair and overhaul (MRO) facility, as part of its Rs 35,000 crore fleet purchase deal with Air-India (A-I).

Sources said Thiruvananthapuram was likely to be preferred over Delhi as the Kerala government had allotted 11.5 acre land to A-I free of charge and would allot an additional 3.5 acre at a later date.

A-I will acquire 68 aircraft, including 18 B737-800, eight Boeing 777-200LR, 15 B777-300ER and 27 B787, from Boeing. Deliveries of the aircraft would start in October 2006.

A-I's proposed base, the cost of which is estimated at Rs 50 crore, would help in maintenance of B737-800 aircraft in Kerala, from where most flights of

A-I's low-cost arm, A-I Express, originate. "There is, however, no clarity on Boeing's MRO. It is not clear whether it will be a captive facility or a 100 per cent foreign investment," an industry player pointed out.

Earlier, Airbus had also made a commitment to set up an MRO facility in the country along with other promoters which was to entail an investment of $100 million as part of a deal struck by Indian, formerly Indian Airlines, to purchase 43 aircraft for over Rs 10,000 crore.

"Airbus is planning to set up spare parts warehouses in India, not only for Indian but for other carriers as well," they said.

Meanwhile, Boeing has also committed $75 million for setting up of four training simulators and $10 million for training and other civil aviation requirements. The modalities, however, for setting up the MRO have not yet been worked out.