In addition to creating more than 20,000 jobs for Americans back home, the preliminary agreement between India and the US for 10 C-17 Globemaster III heavy transport aircraft for the Indian Air Force, would result in more strategic sourcing activities by Boeing, Pratt & Whitney and other companies involved in the C-17 Globemaster III program.
Each Boeing C-17 Globemaster III heavy transport aircraft supports 650 suppliers across 44 U.S. states. The US $4.1 billion deal, all of which is U.S. export content, will support approximately 22,160 jobs.
In the future, Boeing could also look at incorporating Indian companies in the C-17 Globemaster III program. The aircraft is manufactured by Boeing at its facility in Long Beach, California.
So far Boeing and many of it's tier one suppliers have developed sources in India for various components and engineering services. However the 'made in India' content in these aircrafts is still very limited.
Global tier one suppliers to Boeing, including those from Europe, Australia etc have already set up manufacturing facilities in India and are scouting for Indian companies to produce aerospace components and deliver engineering services.
Boeing Company and the Indian Air Force reached preliminary agreement on the purchase of 10 C-17 Globemaster III military transport aircraft, and are now in the process of finalizing the details of the sale. The preliminary agreement also represents the purchase of approximately 45 engines for Pratt & Whitney. East Hartford’s Pratt & Whitney will produce the engines.
The Boeing C-17 military aircraft is powered by four Pratt & Whitney engines and with spares, it is expected that India would purchase approximately 45 engines.
Pratt & Whitney to step up sourcing and manufacturing activities in India.
Pratt & Whitney has a big R&D engineering footprint in India and is actively working to expand it's manufacturing footprint in the country. The company plans to double the headcount at it's sourcing office in Bangalore to about 80 people in three years. It's local sourcing of components and engineering services will increase 10-fold by 2014, to around $150-200 million a year from the current $15 million.
Pratt & Whitney is finalizing four or five joint ventures with local manufacturers in the coming months. The company is also exploring partnership opportunities with L&T, the Tata Group and other companies. The first joint venture is expected to happen by the end of this year in which P&W will invest 50 per cent (approximately $25 million).
The trade agreement with India to purchase C-17 aircrafts represents three words for Connecticut- jobs, jobs, jobs," stated Congressman John B. Larson (CT-01) upon hearing the announcement. "This is great news for our state and the employees at Pratt & Whitney Aircraft in East Hartford and Middletown. I praise President Obama and Indian Prime Minister Singh for working together to make this historic agreement possible for both nations. This is a win-win situation for the United States and India, increasing our trade and economic relations for years to come."
"Earlier this year, I was proud to arrange a visit by Indian Ambassador Meera Shankar to Pratt to meet with Mr. Chênevert and UTC executives as well as an opportunity for her to speak to the machinists," added Congressman Larson. "Ambassador Shankar spoke to both groups about the great economic opportunity of trade between her nation and the United States. Over the next two years, I will continue inviting Ambassadors from foreign nations to Connecticut to meet with our businesses and further establish trade relations that will benefit our state in the future. Manufacturing is in our state’s DNA and today’s announcement represents the great significance of why we need to continue our vigilance in Congress to support the "Making it in America" agenda."
"I am pleased to welcome India's preliminary agreement to purchase 10 C-17 cargo planes, which will enhance Indian capabilities and support 22,000 jobs back in the US," said US President Barack Obama while addressing a joint press conference with Prime Minister Manmohan Singh.
Once all ten have been delivered, the Indian Air Force will be the owner and operator of the largest fleet of C-17s outside of the United States. India may even order another six C-17s after the first ten.
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