India Thought Leaders: HAL Chairman Sets Firm Agenda For Aggressive Export Sales
Hindustan Aeronautics Ltd (HAL) sits on a robust order book close to Rs 80,000 crore, showing the company's resounding health. As the backbone of the armed services, especially the Indian Air Force (IAF), HAL has firmed up a flight path to stay on top as South Asia's market leader. Brightening its outlook are a series of fixed-wing and rotary platform projects. The offset policy has also been a huge blessing, with a number of global leaders working closely with HAL. Provisional sales for 2009-10 stood at Rs 11,415 crore, up about 10% over the previous year, while the profit before tax for the year stood at Rs 2,617 crore, with growth of 12% over the previous year. The order book has also swelled by more than Rs 12,000 crore during the year. At the company's controls is a man who has ushered in a new shop-floor-driven, intense working philosophy. AVIATION WEEK met HAL Chairman Ashok Nayak as part of its India Thought Leaders (ITL) series.
AW: It has been over an year since you have assumed office. When you look back, what are your accomplishments so far?
A.N.: Well, let me take you through some significant ones, point by point.
· Maiden flight on the first Technology Demonstrator (TD-1) of Light Combat Helicopter on 29 March 2010.
· First flight of LCA Trainer aircraft (PV-5) in November '09.
· Integration and flight evaluation of the new Russian engine AL-55I on the IJT and production of the first Limited Series Production Aircraft.
· Production and Delivery of the first six Raw Material Phase Hawk Advanced Jet Trainer Aircraft.
· Fresh orders have been received for the supply of IJT, DO-228, and an upgrade of Jaguar DARIN-III standard.
The company achieved an excellent rating during 2009-10 against the Memorandum of Understanding with the MoD.
· More emphasis was given to customer support. Servicing of helicopters was taken up at Customer Bases to reduce the time involved in ferry to HAL.
· A new joint venture, International Aerospace Manufacturing Pvt Ltd, was formed with Rolls-Royce (RR) in Bangalore. The JV will be engaged in machining of compressor shrouds and casings (up to 800 mm. dia.) for Civil Aero Engines for RR. This will establish indigenous capability in the manufacture of parts for large civil aero engines.
AW: When you put 2010-11 in perspective, what are the key projects that could enter various levels of completion?
A.N.: We are targeting commencement of delivery of the ALH-Mk-III variant to IAF and the Army. ALH-Mk-III is the helicopter with Shakti engine and mission sensors suited for military applications, including high- altitude operations. Weapon trials on ALH Mk.IV (Armed Variant) also will be completed toward certification of the variant. Another major milestone targeted is the delivery of IJT for user trials. The flight evaluation of the AL-55i engine has been completed. Evaluation of spin characteristics, one of the critical flight parameters for a trainer aircraft, is planned in the year.
AW: Could you give us an update on various ongoing programs?
A.N.: (a) SU-30MKI : The present schedule will be completed by 2015-16. Additional orders are anticipated from IAF, and this will keep the production line active till 2017-18.
(b) Hawk: Technology absorption envisaged in the program is completed and production of aircraft from raw materials is under progress. Additional orders are anticipated and will keep the production line active till 2016-17.
(c) ALH: ALH with the Shakti engine suitable for high altitude operations for the IAF and the Army are under production for delivery commencing shortly in 2010. Production of armed variant with turret gun, rocket pod and air-to-air missiles along with Helmet Pointing System is planned in 2010-11.
(d) LCA: Limited Series Production is progressing at HAL. Three more aircraft from the LSP series will join the flight phase during the year. The trainer variant prototype took to the skies in November '09. The second trainer prototype is under progress. These will hasten up the process of achieving Initial Operation Clearance, which is expected to be achieved in December 2010, and the subsequent induction of the first squadron of LCAs into IAF by 2011.
(e) IJT: The certification process is expected to be completed in 2010. Concurrent production of Limited Series is progressing, and the first aircraft under the Limited Series Aircraft was flight tested in January '10. A contract for 73 IJT aircraft has been concluded and the production will be undertaken at Kanpur.
(f) LCH: Maiden flight of the first Technology Demonstrator (TD-1) of the Light Combat Helicopter was completed on 29 March 2010. Work on the second prototype is progressing. Initial Operation Clearance is expected by December 2011. Though LCH was intended for induction by IAF, now the Army is also considering its acquisition.
(g) LUH: Government sanction for the project was accorded in February 2009. Mockup build is completed. Design activities at RWRDC are progressing and the first flight is planned in 2012. This will be a light helicopter in the 3-ton category suitable for replacing the Cheetah/Chetak helicopters. LUH will be powered by the Shakti class of engine suitable for high altitude operations.
AW: Among all the JVs, which are the ones we could look at this year that are sure to deliver concrete results?
A.N.: HAL has 10 JVCs. Out of them three JVCs viz. BAE-HAL Software Ltd., Indo-Russian Aviation Ltd. and Snecma-HAL Aerospace Pvt. Ltd. are fully operational and are making a profit. The other JVCs are in their initial phase of operations and will break even shortly. In the case of Samtel HAL Display Systems Ltd. and Edgewood Technologies Pvt. Ltd., the initial set of products developed is under the testing and proving phase. Deliveries would commence in 2010-11. The HALBIT Avionics Pvt. Ltd., Infotech HAL Ltd. and Tata-HAL Technologies Ltd. is expected to generate profits from the current year. HATSOFF Helicopter Training Pvt. Ltd. will commence operations from July 2010.
AW: What is the latest from the export front? What kind of export targets have you set for this fiscal year?
A.N.: HAL has registered exports of Rs 195 crore during 2009-10 and has set a target of Rs 210 crore for the fiscal year 2010-11. HAL's exports fall into three categories: supply of aircraft (Dhruv, Cheetal/Chetak, Dornier); supply of spares and services to Aircraft and Engines, which fall into HAL's production line and supply of work packages. These work packages are supplies over an extended period of time.
Some of the contracts signed last year and the deliveries are underway to earn long-term benefits. They are: a) supply of Honeywell Garett TPE-331-12 Engine. Contract signed in April 2008 for 600 ship sets (projected value 170MUSD); b) supply of Flaperons to Boeing (contract signed in August 2009, value 37.275 MUSD; c) supply of main passenger door for Legacy 450/500 Aircraft (contract signed in December 2009, value 80 MUSD); (d) supply of weapons bay door for P8-I (contract signed in December 2009, value 4.7 MUSD.)
HAL will also be exporting two Dhruv helicopters to Ecuador, three Chetak helicopters to Surname and one Cheetal and two Chetak helicopters to Namibia.
AW: What kind of firm orders do you have for Dhruv from the Indian customers, including the armed services?
A.N.: Apart from the firm orders for the supply of 159 Dhruv helicopters to the Indian armed forces, orders have been secured for the supply of eight Dhruv helicopters to the Border Security Force. HAL has also supplied civil Dhruv helicopters to ONGC, the government of Jharkhand and the Geological Survey of India.
AW: What update could you give on the HPT-32 revival?
A.N.: A High Power Study Team (HPST) constituted by IAF has recommended certain modifications for increasing the reliability of the aircraft. Initially, modification on 10 aircraft has been taken up for completion by Sept. 10, after which IAF will flight evaluate for their efficacy. IAF will decide on the resumption of flights after this evaluation. An aircraft parachute recovery system is also planned for installation on the aircraft. This would give a safety alternative to the pilots in case of engine failures in midair.
AW: What is the latest from fifth-generation fighter aircraft (FGFA)?
A.N.: Negotiations are currently progressing for concluding the Preliminary Design (PD) contract. The PD contract is expected to be signed shortly, and this phase is estimated to be completed in 18 months. The PD phase will be the preparatory phase during which the transfer of documents, drawings, training, etc. will take place for enabling the joint design, development and manufacture of the FGFA. The conclusion of the PD phase will lead into the R&D phase, which is estimated to be of 102 months' duration.
AW: How far has HAL been able to penetrate the global market? Where do you position HAL by 2012?
A.N.: HAL is emerging as a globally competitive aerospace company, winning the confidence of customers through the supply of high-precision structural work packages to leading global aerospace companies such as Airbus and RUAG in Europe, Boeing in North America and Embraer in South America. We will gradually focus on export of indigenously developed helicopters and trainer aircraft in the future. We will strive to harness the opportunities that emerge through offset. These should take the HAL export sales to substantially higher values in the years to come.
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