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Air-India & Airbus in dogfight over plane purchase

Air-India (A-I) has taken "strong exceptions" to the remarks made by Airbus Industrie's Vice President Nigel Harwood, who had accused the carrier of preferring Boeing to Airbus aircraft while placing orders for 50 aircraft with deliveries slated by 2007-08. A-I Chairman and Managing Director V Thulasidas in a hurriedly called press conference in Mumbai refuted all but one allegation. Sajeev G Nair provides a first person account of A-Iís defense on the allegations made by Airbus Industrie.



Air-India has committed mistakes on evaluation process, while placing orders for 50 aircraft worth over $6 billion which went to Boeing rather than to Airbus. There were reasons other than the merit of the aircraft, including "political, geo-political or even worse" issues. We take strong exceptions to these allegations, which are completely baseless and uncalled for. A-I is a reputed and well-established international carrier, with adequate experience and exposure to evaluate aircraft and decide what is best of it.

The decision to acquire the aircraft from Boeing and not from Airbus was taken into consideration after A-I's techno-economic committee had evaluated it and decided the Boeing deal was best at the present moment.

A-I's decisions were not influenced any political, geo-political or even worse issues, but was finalised for commercial and economic reasons.
 A-I prefers Boeing to Airbus and the decision to go for Boeing, in spite of Airbus giving the best proposal points fingers at "other factors at work".
Air India values the contribution to the carrier by Airbus and there was no preferential treatment towards Boeing. At this point of time, we thought that Boeing aircraft suited our business plan, rather its France-based competitor.

Moreover, A-I's total fleet comprises more of Airbus planes than Boeing. Of the total 43 aircraft, with the planned acquisitions to be completed in June-July, over half of the carrier's aircraft would be of Airbus. The company is taking an additional three A 310s on dry lease in the next couple of months.

A-I is the largest operator of Airbus fleets in the world.
Airbus has bigger aircraft like the A 380, compared to the ones that were being offered by Boeing.
At present, A-I is not interested in A-380, the huge plane from Airbus, but this doesn't mean that we would not go for it at a later stage. A-I needs only small planes at the moment, mainly A 310s or A 320s, but does not need huge aircraft like A 380. The carrier needs more number of medium-sized aircraft for its operations, rather than huge aircraft like A 380. With the market growing and more Indians travelling to US and Gulf, we may think of introducing the A 380s among our fleet.
Airbus has also offered A 350, which was better than Boeing aircraft in similar range.
Airbus had not offered the A 350 when the quotation in reply to the RFP was submitted. The A 350 never came into picture even till the last day of closure of the RFP (December 10, 2004) nor till the date of the board finalising the plans, which was on December 24, 2004. However, exactly after a month, on January 24, 2005, Airbus came with a new proposal including the A 350, which was not considered. A-I could not consider the aircraft as all the formalities of the RFP had been closed by that time and the evaluation process was well under way.
A-I had sought a nine abreast seating arrangement (nine in a line) in its Request for Proposal (RFP) with Boeing, while that given to Airbus had only sought an eight abreast seating capacity. This had also resulted in Airbus losing the contract.

A-I did not seek a nine abreast seating arrangement while ordering for the flights. The RFP was same to both the aircraft manufacturers and abreast seating was not mentioned in the proposal. However, specifications on seat pitch and width and aisle width were mentioned.
Boeing had deferred on delivery schedule, even though the orders went to the company.
This one allegation is true, however the untold part is that it is true that both the aircraft manufacturers had deferred on the delivery schedule. The delivery of first three A 340-500 and a A 340-600 long-range was not in conformity of schedules, according to which the aircraft were to be delivered between 2007 to 2008 (March), while Boeing was to delay delivery of a 787 by six months. However, this had not affected the evaluation processes.
The evaluation process of by A-I was unfair to Airbus, while it gave undue advantage to Boeing.
If the evaluation process was unfair, it was unfair to both as A-I's techno-economic committee had evaluated aircraft of both the companies using the same yardstick. This is an unfair allegation from the part of Airbus.
With a controversy erupting Airbus had suggested for a probe by Central Vigilance Commission (CVC).
The issue was referred to CVC before the demand by Airbus, while A-I board has also referred the issue to Civil Aviation Ministry and Comptroller and Auditor General (CAG).


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