HAL to accelerate aircraft manufacturing

After bouts of limited activity and financial problems, Hindustan Aeronautics Limited (HAL) said on Thursday that it has received orders worth Rs 80,000 crore.

Speaking at a press conference at Aero India 2021, R Mahadevan, Chairman and Managing Director of HAL said that the company’s order book (without the Tejas order) is currently about Rs 52,965 crore.

“With the addition of the recent Tejas order, the company’s order book crosses Rs 80,000 crore. Plus, we are expecting two more orders and that will be for the Light Combat Helicopter and the HTT-40 trainer coming up next year,” Mahadevan said, adding that the orders will push the company’s order book to well over Rs 1 lakh crore as per the company’s expectations.

Also read — Govt formally seals Rs 48,000 cr deal to procure 83 Tejas LCA from HAL

At about 10.30 am on Thursday, the IAF formally issued its long-expected request for proposal (RFP) to the HAL for 70 of its HTT-40 turbo trainer. An additional 36 aircraft are expected to be delivered upon the successful induction of the first batch of machines. The total deal is expected to amount to Rs 8,722.38 crore.

The PSU said that its helicopter division in Bengaluru is presently busy manufacturing ALHs for the army, navy and coast guard and that the activity will continue for the next two years. “With the Light Combat Helicopter being signed, that will also come from there,” Mahadevan said.

“From 2024-25, the speed of our manufacturing will increase,” he added.

However, its biggest boon has been the formal handover of the government order of the Tejas Mark IA. Starting from Thursday, the company is contractually obligated to deliver the first aircraft within 36 months, by March 2024, with the rest to be delivered within five to six years, although Mahadevan said the company hopes to shorten this delivery period by a year.

Mahadevan explained that not all of the Rs 48,000 crore awarded for the contract is applicable for the aircraft or will come to HAL. An initial tax component of Rs 2,200 crore will go for the Exchange Rate Variation (ERC). In addition, Rs 7,000 crore will go for customs and taxes while Rs 11,000 crore will be auxiliary elements such as spares, ground equipment and training documentation. The removal of these reduces the order amount to about Rs 25,150 crore, HAL said.

“The cost per Mark IA aircraft comes up to Rs 309 crore per machine for the fighter version and Rs 280 crore per for the training version,” Mahadevan said, adding that the company will market for aircraft for export at the same prices.

In addition, Rs 6,000 crore will go to MSMEs who have partnered in the project with another Rs 3,000 crore going to larger Indian partners. According to HAL, 463 vendors, including MSMEs and larger companies have partnered with HAL to produce the LCA. Mahadevan said he expects the number to go up to 600.