Posted on 04/13/2005 1:37:38 PM PDT by wk4bush2004
The Air-India board wants to buy 50 commercial aircraft worth $6 billion, from Boeing Corp. Naysayers have been quick to impute motives to the transaction, pointing out that the only beneficiary would be the Seattle-based aircraft manufacturer; a few have said that the deal is driven by politics, not commercial sense; others have suggested that it makes no sense to buy so many planes from one seller. In fact, this deal could boost India's strategic relationship with the US and New Delhi is engaged in a geopolitical balancing act, soothing US nerves at losing Indian Airlines' $2.5 billion order to Europe's Airbus.
The order is large, but that's because A-I hasn't bought planes for many years. Now, our aviation sector needs to grow very fast. For example, the number of India-China flights is scheduled to rise six times soon, from seven to 42 flights a week. So, the right question to ask is: In return for such a large order, is there anything we can get out of the US? There is. India could, for instance, ask Boeing to shift part of its manufacturing operations to India, which could become a low-cost aircraft manufacturing support centre for the US giant. This is a win-win situation: Boeing gets a huge topline lift from the order. Over time, its bottom line is boosted by cost cuts from manufacturing in India rather than in Seattle.
While buying military hardware, India insists on co-production. Bangalore-based Hindustan Aeronautics Limited (HAL) has emerged as a competent manufacturer of military aircraft. It also makes accessories and components for Airbus. Indian companies have secured deals to make software for Boeing. Boeing already has manufacturing, services and software operations in a few places like Australia and Canada. Neither country has India's cost advantages. Therefore, Boeing could be asked to demonstrate its commitment to the Indian aviation market, from simple procurement to outsourcing. In any case, commercial plane manufacturing is an assembly job, putting together a vast number of complex components that ultimately turn into an aircraft. Boeing should take a cue from another Seattle-based global giant. Microsoft set up its first overseas development centre in Hyderabad some years ago, and has not regretted its decision. The conditions are right for another major Indo-American partnership to take wing.
Boeing won't move manufacturing from the US. It's one of their trademarks. They've been a part of the Seattle area ever since their founding.
Plus, moving aircraft assembly to India would cause a massive political war in Washington state and all over the assembly as well.
I meant 'nation' in the last sentence, not 'assembly.' Typo.
Free Trade bump!!!
Boeing has already moved a lot of their assembly (and some manufacturing) offshore. It happened a long time ago. Many of the engines for commercial aircraft are made overseas too. I won't name any countries, but it starts with C and ends with hina.
Thag
Is Airbus moving production to India? No? Then piss off.
Many of the parts are made overseas but the aircraft are still finally assembled in the USA. Boeing has sold their component manufacturing divisions, wanting to focus only on aircraft design and final assembly.
This won't hurt anybody in Congress. They don't work manufacturing jobs. In fact, their stock might just go up as Boeing cuts labor costs.
"Plus, moving aircraft assembly to India would cause a massive political war in Washington state and all over the assembly as well."
Come on now... do you believe anyone with influence or power actually cares? If the profit margin goes up $1.00, good bye Boeing!
I was referring to final assembly.
The wings of the 787 are being built in Japan.
India is going to be developing some of the software used in the 787's computers.
I think Boeing has been trying to get as much worldwide participation in the aircraft as possible to get more support for the aircraft.
That is hilarious.
Do you know the union battles that Boeing has suffered through over the years? They would relish any opportunity to kick the Unions in the teeth, and that is exactly what they are going to do.
Boeing does not care about any Washington State political war; the state is powerless to do anything to Boeing these days. Piss them off, and Texas will roll out the red carpet for them.
Well, even though they are both liberals, Senators Patty Murray and Maria Cantwell are fierce supporters of Boeing and would not tolerate a move of aircraft final assembly out of Washington. Boeing has a lot of other supporters in Washington as well.
Except John McCain, who would be perfectly happy to see Boeing liquidate.
Ping!
The Indians just want the technology, training and equipment and so forth. They pulled the same stunt with Coca-Cola years ago and Coke said C-ya. Hope Boeing odes the same.
"would not tolerate a move of aircraft final assembly out of Washington. Boeing has a lot of other supporters in Washington as well. "
You're confused. Government has no say in it.
As for if it's right or not, the folks here will tell you the only thing that makes it right is profit. (I don't subscribe to that).
While buying military hardware, India insists on co-production. Bangalore-based Hindustan Aeronautics Limited (HAL) has emerged as a competent manufacturer of military aircraft.
Tell ya what, India, why don't you try making your own Jumbo Jets? Not so comfortable with simply a "competent" manufacturing record?
Maybe working in a call center or running an old freighter aground and ripping it apart with your bare hands is more up to your speed.
Owl_Eagle
(If what I just wrote makes you sad or angry,
I was just thinking that there would be a lot of pressure on Boeing from the political side.
"I was just thinking that there would be a lot of pressure on Boeing from the political side. "
Sorry, no. There is no political pressure so to speak. The only thing that companies recognize is the bottom line. They don't see what happens to their neighbors. They don't take into account the security of their former home country. They don't worry about ANYTHING except the bottom line.
If you work for Boeing, I'd either look for a new job now, or start taking classes in Hindii.
I'm not sure if there's anything to panick about yet. It's just someone's opinion. I don't think that Boeing will move their final assembly. They have a perfectly good facility in Everett, WA (which is well-known worldwide) and another major facility in Renton, WA. Plus, if the aircraft were assembled in India, the delivery costs would be enormous. That is why Dell is starting to come back to the US from China to manufacture computers. It saves them money.
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