Back in India nine years after his initial stint in the country, Boeing India President and Boeing International Vice-President Dinesh A Keskar stresses that India is an important market for Chicago-based Boeing. An out and out aircraft man, Keskar has been with Boeing for close to three decades. In his current role, he is focusing on expanding the company’s local presence and pursuing new growth initiatives in India. Keskar spoke to Sneha Kupekar. Edited excerpts:
Boeing in India hasn’t been able to break into newer accounts and most of its sales are to loyal Boeing customers. IndiGo and Kingfisher Airlines do not have a single Boeing plane. What's your strategy for tapping new customers?
Our strategy is to go for long-term and long-established customers. Air India, Jet Airways and SpiceJet are some of our big customers, so it's a mix of low-cost and full-service carriers as well. The airline industry is a capital-intensive business and requires hundreds of millions of dollars to get into the act, so new players come in very slowly. We aren’t looking for 100 per cent market share. We feel comfortable about our positioning in India.
You have often said you are committed to sharing knowledge resources and technology. How is Boeing going about it?
We have research programmes with the Indian Institutes of Technology and the Indian Institute of Science. This helps both the students and the faculty. Boeing makes it a point to share new developments for an enhanced flying experience for long-haul flights with the industry and students. For example, the 787 will have large windows and more pressurised cabins for direct flights between cities such as Mumbai and New York. We share such developments with the industry.
Reportedly, Boeing lost out on an order of 100 planes from IndiGo. There is talk that IndiGo might be looking at acquiring 150 planes again. In case it does, how will you pitch differently to win the order?
How is it possible to lose an order you don’t bid for? The norm in the industry has usually been to order 10 to 20 planes and once those are delivered, order the next batch. There is huge competition between airline operators now and everyone is looking to add to their fleet. The airline industry was suffering from overcapacity and increase in the prices of aviation turbine fuel (ATF). This resulted in the industry losing money. We decided not to bid for the IndiGo order. However, we haven’t spoken to IndiGo about the 150-plane order yet.
Has Boeing written off the development of an MRO at Nagpur? If not, what's the status now?
Our commitment towards the development of a Maintenance, Repair and Overhaul (MRO) base at Nagpur still stands. We have already signed the land lease and are also in the process of shortlisting a project management company. A construction company will also be signed on soon and work on the base will start before the end of the year. By Q4 of 2010 the ‘bhoomipujan’ can be expected.
The 787 and the KC 767 programs remain troubled. Will the programmes continue to limp along?
The 787 has completed 1,000 hours of test flights and we will be delivering the first 787 to All Nippon Airways, a Japanese carrier, by the end of the year. The 787 will also be delivered to Air India in March-April 2011, the total order of the national carrier for the 787 is 27; Jet Airways will be delivered its 787 in three years, their order is for 10 aircraft; For the record, I would like to make it clear that Air India hasn’t cancelled a single Boeing order.
The production of one of your most popular aircraft, the 777 is to reduce to five from the earlier seven per month from June onwards. How’s that going to affect Boeing India, with the 787 still not completely ready?
Boeing has decided to raise the production of the 777 back to seven per month. In 2009, the airline industry was in doldrums, with the USA and Europe in particularly bad shape and Asia also feeling the heat due to the economic downturn. The industry has put the recession behind it and we would like to keep up with market needs. We believe the production of seven 737 per month is justifiable, with the strong demand from the market.
There were plans to re-engine the 737. Is it still on the anvil and what difference will it make?
The 737 has been one of Boeing’s most popular planes. We have increased the production of the 737 from the earlier 31 to 35, due to a strong demand and a backlog. Plans to re-engine the 737 are also currently in discussion. At air shows such as in Bangalore and Hyderabad in India and abroad, we discuss these issues and take feedback from customers. However, with the present version of the 737, we have decided to increase production to 35 units per month.