Thursday, November 01, 2012

EADS/Airbus Wins Indian Tanker Competition

A330MRTT DURING TRIALS AT LEH
EADS/Airbus has won the Indian Air Force's $1.3-billion tanker competition, with its A330 MRTT beating the Il-78M. While an official confirmation is still awaited, DefenceNews (which broke the story) reports that the A330 won on overall lifecycle, maintenance and fuel costs, but still fell behind on unit cost per aircraft -- like it did the last time. The competition was aborted in an earlier attempt after the Indian Ministry of Finance refused to accept the IAF's plea that the A330 would be a more economical aircraft to operate, even if the cost of the deal was markedly higher than the Russian bid. The cancellation had been a stinging blow to EADS.

EADS will remain cautious on the win until negotiations actually start. The last time, a proposed deal with EADS for the same aircraft was shot down by the Ministry of Finance, though this time the company is understood to have approached the competition differently.

9 comments :

Anonymous said...

Shiv how can I have a tour to CVRDE chennai? Plz help.

Anonymous said...

Refueling Boom Falls off Airbus A330 Tanker During Test Flight

The plane, scheduled to be delivered to the United Arab Emirates later this month, was flying in a region between Madrid and Portugal when the incident happened at 7:30 p.m. local time Sept. 10.

Subho said...

My view on thsi is that the MoF will reject the Airbus proposal again on cost and the competition will be reopened for a third time allowing Boeing to return as a bidder and eventually walk away with the contract !

Anonymous said...

Its not a play ground.

Indian Taxpayer said...

THis tender was purposely re designed to allow A 330 to win the contract.

Already in 2009 (when dollar-rupee exchange ratio was much more favourable than today) A-330 acquisition price was esteemed almost the double of Il-78 "Midas" with a difference of about 4000 crore.

Now, this re bid ,in order to make the A-330 appear the lower bidder, employs a very old "trick" (used very often in western media and by weapon operators marketers to mask the ridiculously high price of theirs products ): it examine a time window some dozen of years long to obtain, thanks to supposed lower operating costs, a cost figure for a competing platform lower than the aggregated cost of procurement of the competing product with its "life cycle" costs over an operation life of 25-30 years.

Eventually we the taxpayers suffer. SHAME on the Indian Govt.

Anonymous said...

> A-330 appear the lower bidder, employs a very old "trick"

Examining life-cycle costs isn't a 'trick', it's sound decision-making

Crore said...

@ Indian Taxpayer

So operating costs have nothing to do with it? Operating costs are of GREAT importance when looking at military equipment. If you take a fighter jet during war time as a very relative example.

If it has lower operating costs it's probably due to a lot of equations, e.g. spare-parts,how easy it is to change spare parts, the availability of spare parts or the equipment and time needed to change spare parts, or fuel consumption as fuel costs just as much weather it's a russian or an american engine. If you take those facts and insert them to a real life situation in war, fuel consumption, the ease of handling and the availability of spare parts are of enormous value. Fuel supplies might be cut off, mechanics might be lost in air strikes, newly trained pilots might have to be inserted straight into battle.

The Mi-78 might be cheaper in the short run, but seeing as India will fly these tankers for 30 years, it's not a cheap trick, but FACTS to buy the one cheaper in the long run.

Compare it to a Gripen E VS. an Su-35 as an example. The Gripen E would cost about 65-75 M.USD whilst the Su-35 would cost about 45-65 million USD. The Su-35 would thus, be cheaper to buy initially. BUT, the Gripen E has one of the lowest operating costs for any modern fighter jet, landing at around 4,500$ per hour, whilst the Su-35 costs about 20,000$ per hour and has much higher costs and longer maintenance time changing all sorts of spare parts. How big of a difference do you think that would be in 30+ years? Exactly.

Indian Taxpayer said...

@Crore,

I am taking Lifecycle Costs into the equation to arrive at my conclusions.The comparisons between the SU 35 and the Gripen does not hold much water . The SU 35 is a heavy strike aircraft that has a far greater range of operation than the Gripen . Also it pales into insignificance when compared to the manoeuvrability capabilities of the SU 35 .

syntaxerror9 said...

Good choice.
A330MRTT is the newest and best tanker!