NEW DELHI: As the world's fastest growing aviation market, India not only requires a large number of aircraft but also is a key part of the global aerospace supply chain. It remains to be seen if US President Trump's tariff announcement add to the supply chain challenges that have meant a long wait for airlines - both Indian and foreign - to get not just aircraft but even other things like seats.
The two key aircraft-makers are Europe's Airbus and America's embattled Boeing , with both doing over billion dollar sourcing from India. The suppliers of Boeing have now joined the ranks of anxious airline customers who face a long wait for planes.
Hours before President Trump was to announce his tariffs, Boeing CEO Kelly Ortberg was asked by a US Senate committee what impact the same could have on the aerospace major. His reply was telling. While saying he was awaiting the announcement, Ortberg replied: "80% of commercial aeroplanes we deliver are outside of the United States. So free trade is very important to us. And 80% of the content of those aeroplanes comes (from) out of the US. So we are the ideal kind of export company where we are outselling internationally, creating long term high value US jobs. It's important we continue to have access to that market and that we don't get into a situation where certain markets become closed to us."
His statement is especially true for India from where Boeing currently has a sourcing of $1.2 billion annually from 320 suppliers and where it has mega orders from Tata’s Air India Group and Akasa. Officials of several American aerospace companies and their Indian supply partners were apprehensive that the 26% tariff on India announced by President Trump could increase cost of supplies from here.
In a statement, Aequs which operates a precision manufacturing SEZ in the aerospace ecosystem, said: "The reciprocal tariff of 26% announced by the US Government for goods imported from India is a developing situation.... We are studying the possible implications of this announcement, which is largely unclear as of now. As we conclude US-India BTA in the coming months, we will see much clearer manageable path to tariffs that we could plan for the long term. However, we feel punitive tariffs by any party are cost accretive and will put pressure on industries and result in loss of their competitive ability.”
A senior official of a major US supply chain company that makes in India said: “We are still doing an assessment to understand (the tariff announcement) better, in terms of goods versus services and other aspects. It will take a few more days for us to get a clear picture."
The two key aircraft-makers are Europe's Airbus and America's embattled Boeing , with both doing over billion dollar sourcing from India. The suppliers of Boeing have now joined the ranks of anxious airline customers who face a long wait for planes.
Hours before President Trump was to announce his tariffs, Boeing CEO Kelly Ortberg was asked by a US Senate committee what impact the same could have on the aerospace major. His reply was telling. While saying he was awaiting the announcement, Ortberg replied: "80% of commercial aeroplanes we deliver are outside of the United States. So free trade is very important to us. And 80% of the content of those aeroplanes comes (from) out of the US. So we are the ideal kind of export company where we are outselling internationally, creating long term high value US jobs. It's important we continue to have access to that market and that we don't get into a situation where certain markets become closed to us."
His statement is especially true for India from where Boeing currently has a sourcing of $1.2 billion annually from 320 suppliers and where it has mega orders from Tata’s Air India Group and Akasa. Officials of several American aerospace companies and their Indian supply partners were apprehensive that the 26% tariff on India announced by President Trump could increase cost of supplies from here.
In a statement, Aequs which operates a precision manufacturing SEZ in the aerospace ecosystem, said: "The reciprocal tariff of 26% announced by the US Government for goods imported from India is a developing situation.... We are studying the possible implications of this announcement, which is largely unclear as of now. As we conclude US-India BTA in the coming months, we will see much clearer manageable path to tariffs that we could plan for the long term. However, we feel punitive tariffs by any party are cost accretive and will put pressure on industries and result in loss of their competitive ability.”
A senior official of a major US supply chain company that makes in India said: “We are still doing an assessment to understand (the tariff announcement) better, in terms of goods versus services and other aspects. It will take a few more days for us to get a clear picture."
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