Boeing Gains More C-17 Work from India

by: Matthew Potter
September 29, 2011

Category: Boeing, Business Line, Companies, Contract Additions, Contract Awards, Countries, Department of Defense, development program, Events, India, Lockheed Martin, Military Aviation, production program, Services | RSS 2.0

The United States government and its defense contractors have been cultivating the Indian market for several years. The biggest payoff so far has been contracts for military transports and maritime patrol aircraft. The most important of current opportunities though, the new advanced fighter contract, has for now chosen to go with European competitors in the form of Dassault’s Rafael and Eurofighter’s Typhoon.

Boeing (BA) has been able to sell its C-17 strategic transport and P-8 patrol aircraft to India. Both of these are large contracts and as with all military aircraft ones offer the advantage of requiring decades of parts, modifications and support. India will receive 10 C-17 aircraft to begin with with the potential for more depending on that country’s requirements.

As part of this effort Boeing this week received a contract modification from India via the Foreign Military Sales (FMS) system where technically the customer is the U.S. Defense Department. This $469 million action is to provide engineering, maintenance and modernization support for India’s C-17 aircraft. It illustrates the potential of this part of the market.

India also purchased 6 C-130J transport aircraft from Lockheed Martin (LMT). These aircraft have already started to be delivered. That contract was worth over $500 million.

The hope is that sales to India may offset some of the potential declines in U.S. and European defense spending. India and Brazil are considered two of the largest future markets available for defense items although Brazil’s plans to modernize and expand its military have slowed down in recent months.

India is still buying large amounts of Russian equipment as it historically has but is adding injections of Western systems like the P-8I based on Boeing’s 737 derivation for the U.S. Navy. The new fighter contract will be for over 100 aircraft and would represent the most modern and technically advanced systems in use by India. India has also invested heavily in domestic industry for the development and production of advanced weapon systems.

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