Aircraft engines manufacturer CFM International, a joint venture between General Electric Co and Safran of France, is positive about the prospects of sourcing parts from India for its next-generation LEAP engine, which is expected to enter commercial service around mid-2016. In an interview, CFM International's president Jean-Paul Ebanga tells K Rajani Kanth about the company's plans, including replicating its Chinese manufacturing model in India. Edited excerpts:
At the Singapore air show last month, CFM bagged $4.9 billion worth of orders for its new-generation LEAP-1A engines. How many aircraft will be powered, and the time frame for it?
The order is from Transportation Partners, the leasing division of Lion Group, for 348 Leap-1A engines to power all its 174 A320 Neo aircraft that they have on order. The time frame for delivery, however, depends on the airline's plans of increasing its capacity and fleet.
What is your current backlog?
While 25,000 CFM-56 engines are currently in operation globally, including 400 engines in service in India, more than 27,000 CFM-56 engines will be in operation in 2018. We have a backlog of 14,000 engines (each valued at euro 12 million), which means roughly 10 years of production.
Given the scale and the backlog, are you looking at sourcing some parts for your engines, including LEAP, from Indian companies?
The CFM-56 now, and the LEAP engines tomorrow will be assembled using parts coming from all over the world.Though the main industrial clusters are in the US and in Europe, we have significant production of the parts in Asia. We have companies in India supplying parts to our entire CFM-56 fleet.
Sourcing is a dynamic process. Of course, will continue to source parts from India in future, as we have done in the past. LEAP engine parts will be manufactured in India as well.
The LEAP is set to be the next engine of preference for the market and the airlines have a very high-level of expectations in terms of the engine value. We are looking for the best sources around the world for LEAP. Our supply chain is global, and India will always be a part of it.
Are you exploring any possibilities of setting up your own manufacturing unit in India?
We are committed to India for the long-term. Talking to your minister (Ashok Gajapati Raju) yesterday, I took the example of China. We started in China by producing small parts 20 years ago. We were able to move from there to a stage where we were producing complex parts, and then moving to a stage where we are now doing a full module in China.
I told your minister that there is no reason why we cannot do the same in India. But for that, we need to have the right business environment and the right companies with the right level of competitiveness. Looking forward, it should be a win-win situation for the Indian companies, and the Indian government should facilitate all these for the companies to grow.