Discussing Supply Chain Opportunities For India | News18 Rising India Summit | CNBC-TV18
Summary
TLDRBoeing's significant deal with India involves supplying 220 planes and potentially 70 more, reflecting India's booming aviation market with an estimated 2200 planes needed in the next 20 years. Boeing is enhancing local support with logistics and customer centers. India's focus is on infrastructure growth and efficient airspace usage to accommodate this expansion. The discussion also covers India's potential to become a global manufacturing hub, with aspirations for Indian brands to go global, supported by a strong EMS sector and design-led manufacturing. Mercedes highlights India as its fastest-growing market with 10 launches planned and a commitment to electric vehicles.
Takeaways
- 🚀 Boeing secured a landmark deal to supply 220 planes to Air India with an option to supply 70 more aircraft in the future.
- 🌟 The Indian aviation market is projected to grow significantly, with an estimated need for 2200 airplanes over the next 20 years.
- 🛠 Boeing is focusing on enhancing customer support in India by establishing logistics and customer support centers to provide local assistance.
- 🏗️ Infrastructure development is crucial for the aviation industry in India, with plans to double the number of airports and aerodromes.
- 🔄 Optimizing airspace usage and integrating with new technologies like drones and UAVs is essential for handling increased air traffic.
- 💹 The vision for Dixon is to be among the top five EMS companies globally, focusing on large-scale manufacturing and Industry 4.0 processes.
- 🌐 Indian brands are expected to rise globally, following the pattern of South Korea and Japan, by first focusing on EMS and then on designing their own products.
- 🚗 Mercedes sees India as its fastest-growing market and plans to launch 10 new models, including four electric vehicles (EVs) in the next 12 to 18 months.
- 🌐 Boeing's sourcing from India is on an upward trajectory, with a focus on increasing capabilities rather than setting a specific numerical target.
- 🏭 The manufacturing sector in India is expected to grow, with a focus on smart mega-factories and leveraging domestic market strength for export opportunities.
Q & A
What is the significance of the Big Air, India deal for Boeing?
-The Big Air, India deal is significant because it involves Boeing supplying 220 planes to Air India, with the potential to supply an additional 70 aircraft. This reflects the growing aviation market in India and Boeing's commitment to meeting the evolving needs of its customers.
How does Boeing plan to support Air India's future aviation needs?
-Boeing plans to support Air India's future needs by offering flexibility to upsize their order as the market grows. They also aim to establish logistics and customer support centers in India to ensure timely technical support.
What is Boeing's forecast for the Indian aviation market over the next 20 years?
-Boeing forecasts that the Indian aviation market will grow significantly, with an estimated 2200 airplanes needed over the next 20 years.
What infrastructure challenges does the Indian aviation market face?
-The Indian aviation market faces challenges related to airport infrastructure, which needs to be expanded to handle the anticipated growth in air transport passengers. The government's initiative to double the number of airports and aerodromes is critical for this growth.
How does Boeing plan to enhance its presence in India?
-Boeing aims to enhance its presence in India by setting up large capacities, world-class infrastructure, and focusing on efficiencies and Industry 4.0 processes. They also plan to skill the workforce and focus on diversity in their operations.
What is the vision for Dixon's growth in the EMS sector?
-Dixon's vision is to be in the top five EMS companies globally, which involves setting up large capacities, focusing on efficiencies, and adopting Industry 4.0 processes.
How does Dixon plan to create Global Brands from India?
-Dixon plans to create Global Brands by initially focusing on being the brand behind the brand, then designing their own products, and investing in the brand and ecosystem.
What is the current status of Mercedes in the Indian market?
-Mercedes is the fastest-growing market for luxury vehicles in India, with double-digit growth expected in the coming years.
How many new launches does Mercedes plan for India in the near future?
-Mercedes plans to launch 10 new models in India in the near future, with a focus on electric mobility.
What is the current sourcing value of India for Boeing globally?
-The current sourcing value of India for Boeing globally is over 8000 crores, with a focus on increasing capabilities rather than setting a specific numerical target.
How does Sanjeev view the future of manufacturing in India?
-Sanjeev sees a bright future for manufacturing in India, with a focus on smart mega factories and the potential to reach 300 billion dollars in manufacturing.
Outlines
🛫 Aviation Growth and Boeing's Deal with India
Boeing has secured a significant deal with India, supplying 220 planes and potentially an additional 70 aircrafts. The Indian aviation market is anticipated to grow exponentially, with an estimated need for 2200 airplanes over the next 20 years. Boeing aims to provide flexibility for customers to increase their orders as their requirements evolve. To support this growth, Boeing is establishing a logistics center in India for parts supply and a customer support center to ensure timely technical support. The company emphasizes the importance of infrastructure development and efficient airspace utilization to accommodate the anticipated influx of aircrafts. Boeing's vision is to be among the top five EMS companies globally, focusing on large-scale capacity, world-class infrastructure, and Industry 4.0 processes.
🚗 Mercedes' Growth and India's Manufacturing Potential
India is the fastest-growing market for Mercedes, with double-digit growth expected this year. Mercedes plans to launch 10 new models in 2020 and is committed to localizing electric vehicles (EVs) in India, launching four more EVs in the next 12 to 18 months. The conversation also touches on India's potential to become a global manufacturing hub, with a focus on smart mega-factories and the importance of skilling the workforce, including initiatives like a 100% women assembly line for electrical components. The panelists express optimism about India's manufacturing sector, highlighting the country's strengths in domestic market participation and export opportunities. They envision India becoming a hub for manufacturing on a global scale, drawing parallels to the growth trajectories of countries like South Korea and Japan.
Mindmap
Keywords
💡Big Air, India deal
💡Airbus
💡Aviation
💡Logistics Center
💡Customer Support Center
💡EMS companies
💡Global Brands
💡Electric Mobility
💡Manufacturing in India
💡Infrastructure
💡Diversity
Highlights
Boeing's landmark deal with Air India for 220 planes, with an additional 70 aircraft possible.
Boeing offers flexibility to customers to increase orders as their needs evolve.
Forecast predicts 2200 airplanes to enter the Indian market over the next 20 years.
Boeing's strategy includes establishing logistics and customer support centers in India.
Infrastructure growth is critical for the aviation market, with plans to double the number of airports.
Optimizing airspace usage is necessary to handle the projected growth in aviation.
Boeing's vision to be in the top five EMS companies globally.
Indian companies focusing on building scale and design-led manufacturing to create global brands.
Learning from past mistakes to invest in design and ecosystem for long-term brand success.
India is the fastest-growing market for Mercedes, with double-digit growth expected.
Mercedes committed to localizing electric vehicles in India, with four new EVs planned in the next 12-18 months.
Boeing's sourcing from India has been increasing, with a capability target for further growth.
Boeing focuses on skilling workers and promoting diversity in manufacturing.
Sanjeev believes India's strength lies in its ability to meet high-quality product demands.
Neil sees a future where India can manufacture goods worth 300 billion dollars.
The panelists express optimism about India's manufacturing movement and opportunities.
Transcripts
salil I I want to talk about the Big Air
India deal congratulations Boeing is
inch uh that Landmark deal along with
Airbus uh 220 planes is what Boeing will
be supplying to Air India but there's a
additional top up so you you are likely
to supply 70 more aircraft what are the
what's the deal with that well so we we
all when we have large airplane orders
we always give our customers flexibility
uh to to top that up as their needs
evolve over time look the Indian market
for Aviation is going to grow Leaps and
Bounds we forecast
2200 airplanes to come into the Indian
market over the next 20 years and so
with all of our customers we want to
give them a little bit additional
flexibility to upsize their order when
it's the right time for them to do so
and so that's what's what that's about
okay so on the aviation side Air India
220 planes that's a massive order that
that you've Inked and you said that 2
200 planes will be added on that's the
expert expectation and the estimate over
the next 20 years are any constraints
that require redressal at this point in
time to ensure that the opportunity in
the commercial space continues to hold
up yeah so I think the first thing that
we as as an airplane OEM do is we're
only successful when our customers are
successful right so what some of the
things that we've announced over the
past few weeks after the announcement of
that deal is of course the logistics
Center to make sure we have Parts here
in India the customer support center to
make sure our customers can see can
receive the technical support they need
from the region as opposed to having to
call you know Seattle or California all
the time you know those are the kinds of
things that we do to to further buttress
the world-class technical people that
we've had on the ground here for years
but from a standpoint of the overall
market growth I think everyone will say
it's maximizing the growth of
infrastructure here because what's going
to happen we had 140 million Air
transport passengers per year before
covid and now we're getting back to that
figure and surpassing that figure if you
look at airport infrastructure it's not
too far above that that number already
in terms of what it can handle and so
that's why the government's initiative
to double the number of airports and
aerodromes uh is critical to enabling
the delivery of those 2 200 airplanes
over the next 20 years
um and in addition to building the
physical infrastructure we have to build
we have to optimize how we use the
airspace how we integrated with defense
how we integrated with drones and uavs
the unmanned vehicles that are going to
be coming up and make the most of the
infrastructure we have it's only if we
do that that we will be able to actually
take those airplanes that we expect to
come in Sunil uh you know what's the
aspiration now uh or you know it's a
from from the last 20 years to where you
are today you've managed to build a 10
000 plus crore rupee company at this
point in time what's the Target that you
set for yourself over the next few years
Well normally I do not set Targets in
terms of numbers because I think you're
restricting yourself whenever you do
that uh but the vision is now that we
want to be in the top five uh EMS
companies globally uh which would mean
uh you know setting up large capacities
world-class infrastructure and focusing
on efficiencies and Industry 4.0
processes
and a huge scale over a period of time
uh and I'm confident uh the way India is
going the kind of policies that we have
in place uh I think is just a matter of
time that India becomes the next hub for
manufacturing and Dixon is there in the
top five companies globally we we wish
you the very best of luck with that
aspiration but what about Brands Made in
India for the world
how far are we from that yeah I think I
remember reading a article recently an
editorial that you know we do not still
have Brands which can be known as Global
Brands right where are those Brands and
how are they going to come about but I
think if you look at the history of
Brands which came out uh of let's say
countries like South Korea and Japan
these Brands initially focused on being
the brand behind the brand which is
being an electronic manufacturing as a
service right and I talk about large
Brands which you see now in India the
Korean Brands and the Japanese brands so
what they did was the first they focused
on building a large scale uh then they
focused on designing their own products
and then uh you know putting that money
behind the brand so I think we are at
that stage now that we see a lot of
companies now uh coming out on the EMS
space it's also encouraging that the
financial sector has taken note of that
last uh I think two years they've been
five IPOs which have come in our sector
so that scale has been created that
money is being spent on a component
ecosystem that money is being spent on a
design-led manufacturing so I'm very
confident that a few Indian brands are
going to rise in our sector which are
going to be Global in times to come and
I think we see uh some Brands already
have that aspirations but I think some
of the mistakes that were made if we
look at let's say 15 years back we had
great Brands but probably they did not
really invest too much uh into their own
design in the ecosystem which led to the
downfall but I'm sure now we've learned
from our mistakes those mistakes are not
going to be repeated and very soon we'll
have Indian Global Brands very soon
we'll have Indian Global Brands and and
hopefully cost correction that has been
made an investment in r d and IP will
have to be part of that Santosh India
today one of the fastest growing markets
or is in fact the fastest growing market
for Mercedes yeah it's the fastest
growing market for Mercedes last year
and this year again we expect double
digit close and how many launches do you
have lined up for 2020 10 launches this
year and how and on the Electric
Mobility side how big of that is going
to be a play here in India well we were
the first to launch a luxury even in
India locally produce it so we are fully
committed on the localization of EVS for
this Market uh we feel the consumers are
ready for electric vehicles it's about
uh what kind of suitable products we can
give to the market uh we are committed
to launch another four EVS in the next
uh 12 to 18 months in India okay so 10
launches expected salil uh I'm gonna get
wrap-up comments from each one of you
and let me start by asking you in terms
of sourcing from India for Boeing
globally that has been an upward
trajectory where do you see that over
the next five years so I think so we're
over 8 000 crores today we don't don't
have a number in Target what we have is
a capability Target right and that
capability is both
um what we're doing and how we're doing
it I've already talked about what we're
doing in terms of taking it up the value
curve but equally important is how we're
doing it and for example that means
continuing to skill the the folks that
are doing our work here and that
includes focusing on diversity we have a
factory in Pune with one of our partners
where we have an assembly line for
electrical components which is 100
percent women and it's just done to
prove the point that that is possible
and it's things like that that we'll
continue to do here well you know a
factory with a hundred percent women on
board that does deserve a round of
applause and I hope that we do see much
more of that and I think that is also
going to be uh that is going to be one
of the things that we need to focus on
as we build out the manufacturing story
Sanjeev where do you believe we will
find The Sweet Spot at this point in
time you've got your fingers across 20
different sectors uh 20 different
verticals where you believe that the one
thing where we really do have the
strongest advantage today
well in country as I said all the market
segments are expanding and since the
sophistication of demand in the market
is high and the consumers are asking for
a high quality products so that is
deepening the supply chains and with
that you know our operations are also
getting more sophisticated more
automated so that becomes kind of a
workplace operation by standards uh so
what happens is that automatically
becomes very attractive from the cost
Point as well as the operational
delivery point for the export market so
we see that the by participating in a
good way in the domestic Market it also
opens up a Gateway for the export so I
think that's a sweet spot as we see uh
going forward so Neil uh you know you
talked about Mega factories but are
these going to be smart Mega factories
is that going to be the aspiration no
absolutely and I think this journey has
just started there's a long long way to
go and we're looking forward to the time
that we can do at least about 300
billion dollars of manufacturing in
India and I'm reminded of that uh
Shahrukh Khan movie which said that you
know pictures
so this is just started and I remember
that uh saying you know this famous
poeter said that you know no power on
Earth can stop an idea whose time has
come and this is definitely our time and
this is the time to make in India well
as per the panel yes I'll give you the
final say on this panel so I I just
continue the Bollywood twist because
it's uh you know we have been growing up
to this entire thing that humongous
and it used to be dots I think now we
can do the full stop and now we are
there and we will go to the next level
ladies and gentlemen a big round of
applause uh it is India's manufacturing
movement and Manufacturing opportunity
and we've heard from some of the best uh
that India has today on what it will
take for us to be able to capitalize on
that opportunity thank you very much and
we wish you the very best of luck
[Music]
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