Mahindra intends to add bigger wings to aviation biz

Discussion in 'Strategic Forces' started by Sridhar, Dec 9, 2009.

  1. Sridhar

    Sridhar House keeper Moderator

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    Mahindra-NAL's private aircraft to be launched soon

    BS Reporter / Mumbai December 9, 2009, 0:39 IST
    Mahindra Aerospace, the aerospace arm of Mahindra & Mahindra (M&M), is readying the prototype of a small private aircraft built in collaboration with state-owned National Aerospace Laboratories (NAL). The five-seater, turbo-prop aircraft, NM5-100, will be flown by March. Its first flight was earlier scheduled in mid-2009.


    This is the first time Bangalore-based NAL has ventured into developing small-sized private aircraft with private participation. The institution, responsible for the design of the NM5-100, had earlier worked on designs for the Hansa trainer and Saras, a light transport aircraft. M&M has earlier manufactured and delivered 24 five-seater aircraft for Jordan-based Seabird Aviation Jordan. The planes were manufactured by M&M at the rate of 3-4 units per month. Each plane cost $400,000.
    According to the previous agreement, a substantial part of the design and development of the NM5 will be done by NAL, while marketing and serial production of the plane will be done by M&M. The central government had released Rs 6.5 crore for the project last year.
    M&M is looking to secure aviation component supply contracts from major aircraft manufacturers around the world for military and civilian use. A senior executive from Mahindra Systech, the umbrella unit of the aerospace arm, said the component industry was worth more than $1 billion annually.
    "We are in talks with an Australian company for a joint venture of a buy-out. We are looking for companies around the world which are into the business of aero components. We are ready for a technology transfer or a absolute buy-out”, said Hemant Luthra, president, Mahindra Systech.
    Luthra also reiterated the group's plans of restructuring its auto components business, while bringing them under one company, Mahindra Systech, through a systematic consolidation plan.
    There are three listed auto component manufacturing companies of the group, Mahindra Ugine, Mahindra Composite and Mahindra Forgings and two unlisted companies, Mahindra Gears and Mahindra Castings. In addition there are a number of subsidiaries overseas.
    "Our view is that the market will not be interested in having small IPOs of $100-150 million companies. It is rather better to merge all these component making companies, keeping aside the aerospace division, as it will offer greater flexibility", Luthra added. He pointed out the group was working on various suggestions and that no concrete plan has been initialised.
    "If this is the plan of the group then my understanding is that we should be able to achieve it in less than two years. It is not an easy thing to do as it will involve looking after the interest of many shareholders with their approvals", he further added. According to the group's plan, M&M may buy up to 65-70 per cent in a company and equate the balance of stake to a stake in Mahindra Systech to the target company. The stake offered to the target company may be based on value terms or on an agreement mutually agreed between the two parties. The stakes will, however, not be equal. Promoters of the M&M group may end up owning about 55-60 per cent in Mahindra Systech, which may be listed on the bourses, added Luthra.
    An executive said Systech's turnover (including the aerospace segment) stands at $600-700 million, while the value of the company is pegged at $500 million. These figures were higher in 2008 (turnover at $950 million and value at $700 million) before the recession.


    Mahindra-NAL's private aircraft to be launched soon
     
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  3. Chota

    Chota Regular Member

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    The NM5

    [​IMG]
     
  4. Sridhar

    Sridhar House keeper Moderator

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  5. Chota

    Chota Regular Member

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    Nm5

    Here is another graphic of NM5
     
  6. SATISH

    SATISH DFI Technocrat Stars and Ambassadors

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    Looks like it has broad wings and hence can fly at slow speeds and can provide good lift. I also would like to see it as a CAS aircraft as it is a prop-driven a/c...
     
  7. tarunraju

    tarunraju Moderator Moderator

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    Wow, Mahindra is into aviation too? Nice.
     
  8. plugwater

    plugwater Elite Member Elite Member

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    [​IMG]
    [​IMG]
    both looks very similar
     
  9. enlightened1

    enlightened1 Member of The Month JANUARY 2010

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    Nice pics great going :goodstuff:
     
  10. ppgj

    ppgj Senior Member Senior Member

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    M&M buys stake in 2 Aussie aerospace cos

    MUMBAI: Making a strategic entry into the aerospace business, auto major Mahindra & Mahindra (M&M) said it has picked up a 75.1 per cent stake in two Australian aerospace firms for Rs 175 crore and plans to make aircaft and allied components to service t he global market.

    In a joint acquisition with Kotak Private Equity, Mahindra Aerospace Pvt Ltd (a unit of M&M), bought majority stakes in component maker Aerostaff Australia and general aircraft manufacturer, Gippsland Aeronautics.

    “Over a period of five years, we believe that we could build as many as 475 aircraft in the 2- 220 seater range and expect a peak revenue of about Rs 650 crore,” Mahindra Systech Sector and Member of the Group Management Board, M&M, Hemant Luthra, said o n Tuesday.

    The company is setting up a plant in Bangalore to complement these acquisitions and provide dual shoring and benefits to customers.

    “We now have an opportunity to play in the defence offsets space. We can provide offset components in the commercial aircraft business and we can provide components for the general aviation business,” Luthra said.

    The 2-20-seater market (turbo prop market), is amongst the fastest growing segments in general aviation. Turbo props provide operational adaptability in environments with relatively poor infrastructure and can serve the market at the lowest cost per pass enger seat kilometre. - PTI

    The Hindu Business Line : M&M buys stake in 2 Aussie aerospace cos
     
  11. Chota

    Chota Regular Member

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    Those are HANSA aircraft which is a 2 seater composite used by various flying clubs. This has also been designed by NAL

    NM5 is a 5 seater extension to HANSA jointly developed by NAL and Mahindra Aerospace Pvt Ltd.

    The aircraft is expected to be priced between Rs 1.2 crore and Rs 1.4 crore.

    The engine, propeller and certified seats of the aircraft will be imported as will the raw material like aluminium alloy sheets and hardware such as, nuts, bolts, washers and rivets.

    The NM5 can be used as a trainer, for transporting cargo, medical evacuation, tourism, VIP travel and for training pilots
     
  12. Chota

    Chota Regular Member

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    NAL's 70 seater RTA-70 artist's impression
     
  13. sandeepdg

    sandeepdg Senior Member Senior Member

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    I am eagerly looking forward to the RTA 70 being developed by NAL. But since the details haven't been finalised, i don't think it will take to the skies before 2015-16 since it will take 6 years to develop this aircraft once all details have been finalized. I hope Mahindra Aerospace also moves to making such types of aircrafts which are more viable such as a 15-20 seater turboprop like the HAL Saras. Eventually the most important development would be if we can design and build reliable jet engines in house with PPP for aircrafts of sizes varying from 15-20 seater to around 100 seater. We have all seen the saga of the Kaveri engines for the LCAs. I sincerely wish that we close this gap soon. Then, Indian aviation industry can truly become a global player like Brazil's Embraer.
     
  14. enlightened1

    enlightened1 Member of The Month JANUARY 2010

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    Mahindra turns focus to aviation



    INDIA'S entrepreneur of the year, Anand Mahindra, has a fresh field to conquer: making passenger aircraft, aided by some Australian expertise.

    It’s a market of considerable size. In the Asia-Pacific region alone, Boeing estimates that airlines will spend $1.2 trillion over the next 20 years on as many as 9000 new planes.

    Mr Mahindra, vice-chairman and managing director of the $7 billion conglomerate that bears his family’s name, aspires to turn the group’s aerospace arm into an Indian version of Embraer, the Brazilian plane maker which builds a range of aircraft up to the size of a regional jet.

    But the Mahindra brand is better known for its tractors and utility vehicles, and building a regional jet is a complex and time consuming business that usually starts with the production of much smaller turbo prop aircraft.

    It took Embraer – formed in 1969 by the Brazilian government and privatised in 1994 -- more than 20 years before it built its first passenger jets in the early 1990s.

    To speed up the process, three months ago Mahindra agreed to pay about $40 million for a controlling stake in two small Australian aviation companies, Gippsland Aeronautics and Melbourne-based component maker Aerostaff Australia.

    Gippsland Aeronautics, based in Victoria’s Latrobe Valley and maker of the popular 8-seat GA8 Skyvan utility plane, plans to beef up its range next year with an updated 18-seat version of the controversial Australian-made Nomad twin turbo-prop. It bought the rights to the Nomad’s type certification in 2008.

    The Nomad, designed in the late 1960s and built in Melbourne by the old Government Aircraft Factories between 1971 and 1984, saw service with the Royal Flying Doctor Service and a variety of other civilian and military operators in Australia and overseas. About 170 examples of the Nomad were built, in variants from 12 to 18 passengers. But its reputation suffered from a run of fatal crashes, and the Australian Army retired its Nomad fleet in 1995.

    Aerostaff Australia makes high precision aircraft components and assemblies for makers such as Boeing and Lockheed Martin.

    So far, the Mahindra group’s experience in aviation extends to the co-design of a five-seater plane with the National Aeronautics Laboratory (NAL) of India – designated the NM5 and expected to fly later this year -- and the production under licence of a light Australian plane, the Seabird Seeker, for the Middle East.

    Despite his group’s relative lack of scale in aviation, Mr Mahindra sees great promise in the aerospace industry and the related defence offsets business.

    “We aspire to be a major force in aviation,” he told The Australian in Mumbai earlier this month.

    “The driving force behind our Australian acquisitions is to be the Embraer of India,” he said. “We are not gunning for Embraer. It’s more a case that we see it as a role model.”

    He points out that Brazil was a relatively low income country when Embraer started up and there was little expectation that an emerging nation could develop a successful global aviation business.

    Mr Mahindra, known for his entrepreneurial acumen and ability to spot new business opportunities, said that to define the parameters of any plane that the group might build is to defeat the purpose of the aspiration.

    “There is no point dimensioning it,” he said. So rather than quantify a goal such as a 50, 70, or 90-seat aircraft, Mahindra simply aims to get busy on developing a product line as quickly as possible.

    “Our aspiration is, why can’t there be a company from the Indian private sector with a reasonable stake and a reasonable amount of achievement in aircraft manufacturing?" he said. "That’s the aspiration, and that’s where we’d like to be. We know it took a long time for Embraer to develop that skill, but these days things are compressed and you are expected to achieve things faster.

    “So we are busy plotting a trajectory to get us there. Some of that is organic, but if you are going to make strides, there have to be some inorganic pieces too. And with inorganic, you can’t necessarily plan for it, as was the case with the Gippsland Aeronautics acquisition.”

    Mahindra said the Gippsland Aeronautics deal was attractive because it came with a portfolio of aircraft already flying and another, the Nomad, already certified. “That gives you a kickstart,” he said.

    Mr Mahindra is conscious that it is a step-by-step process, going from a GA8 Airvan to a 10-seater, then to an 18-seater Nomad and on to regional jet. While he recognised that it takes time, he joked that he hoped it will happen before he retired. Mr Mahindra will turn 55 in about a month’s time.

    If and when a regional transport aircraft emerges from the Mahindra group, Anand Mahindra is adamant that it will be a world-class product. “We don’t want two levels of quality and two sets of specifications,” he said.

    “We don’t think in two compartments any more when designing a product. The moment you say this one’s for India and that’s for the world, it encourages a split personality, and that’s not a good thing. You don’t want any schizophrenia in the company.

    “Look, we’ll make a world-class product and we’ll go where the markets are. Arguably, the biggest aircraft markets in the world in the next two decades are going to be China and India anyway."

    Last September, Boeing said it expected the Asia Pacific region to be the world’s largest aviation market by 2028, with about $1.2 trillion being spent on almost 9000 new planes over the next 20 years. Boeing said that strong demand for single aisle planes in China and India meant that about 5600 of these would be single aisle models.

    Along with Boeing and Airbus, makers such as Embraer and Canada’s Bombardier compete for the single-aisle market. Chinese and Japanese manufacturers also aim to enter the sector by 2016.

    Mr Mahindra said India’s huge domestic market gave it a “tremendous home-base advantage” in building a scale business. He said it was important for Indian business people to understand that it was the big domestic market “that allows us to become world-class players”.

    Mr Mahindra and his uncle Keshub Mahindra, who joined the group in 1947 and has been its chairman since 1963, are regarded as among the towering figures of Indian industry. Keshub Mahindra sits on the Prime Minister’s Council on Trade & Industry, while last month, Anand Mahindra was named Ernst & Young’s entrepreneur of the year and business channel NDTV’s business leader of the year.

    The Mahindra group’s businesses include financial services, automotive products, trade, retail and logistics, information technology and infrastructure development. It is one of the world’s biggest tractor makers, with plants in India, China and the United States, and an assembly site in Brisbane, Australia. In Australia, it also sells the Mahindra Pik-Up, a light utility.

    The Mahindra family and associates hold a stake of about 13 per cent in the main group company, Mahindra & Mahindra, which has a market capitalisation of $7bn.
     
  15. nandu

    nandu Senior Member Senior Member

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  16. nandu

    nandu Senior Member Senior Member

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  17. nandu

    nandu Senior Member Senior Member

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  18. Agantrope

    Agantrope Senior Member Senior Member

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    Pics in the 3 posts doent resemble to be same 0_0
     
  19. BunBunCake

    BunBunCake Regular Member

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    It's about time the Private Sector gets a chance......
    If we were to have this in our Defense Projects (suppose Tejas, and Kaveri) more competition = better products.
     
  20. enlightened1

    enlightened1 Member of The Month JANUARY 2010

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  21. Sridhar

    Sridhar House keeper Moderator

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