Airbus bullish on India

Europe-based aircraft manufacturer Airbus is sanguine about its prospects in India. “The company has a market share of 70 per cent in India and its presence is going from strength to strength”, said Kiran Rao, Executive Vice-President, Strategy and Marketing, at Airbus.

Speaking last week at the Airbus Innovation Days 2013 in Toulouse, Rao said that Airbus is very happy with its market position in India. Low cost carriers IndiGo and GoAir have placed large orders for the A320 aircraft, and Jet Airways is using the A330.

Airbus expects its position to further improve thanks to the impending entry of Malaysia-based low cost carrier Air Asia in the Indian skies. Air Asia is the largest customer of the A320 aircraft. On efforts to garner orders from low-cost carrier SpiceJet which operates aircraft from key rival Boeing and Bombardier, Rao said that Airbus is always trying with new customers.

Underscoring the potential of the market, Rao said that under 3 per cent of the Indian population travels in the skies. He expects this number to increase four times.

The opening up of the Indian aviation market to foreign airlines will see new players entering the fray, and the demand for air travel in the country will be met anyhow. It is not for Airbus to determine whether one or the other airline is better, said Rao.

Expressing happiness at the ‘deregulation’ of the Indian aviation market, Fabrice Brégier, President and Chief Executive Officer, Airbus said “We have to supply to competitors (IndiGo and Air Asia), but that’s life. We are confident they will succeed.” Stating that the Indian market at present was not at the level of the Chinese one, he added that there was no reason why the latter’s level of growth can’t be matched.

Brégier said that unlike in China, Airbus has no plans so far to have an assembly line in India, since the market size is not the same. But he expects more co-operation with the Indian industry, adding that it’s “never say ‘no’ in the long term”.

It’s not been all smooth cruising for Airbus in India. Despite lobbying by many foreign airlines, the government’s permission to fly the superjumbo A380 to India is still awaited.

Putting up a brave face, Rao said “We take that (pending permission) as a compliment. (It’s pending) not because it (A380) is not nice, but because it’s too nice.” Alluding to the apprehension of domestic airlines that the A380 could eat into their international load factors, Rao added, “Time will erode that fear.”