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AI May Be Asked To Renegotiate Its Boeing Order  
User currently offlineUALMMFlyer From United States of America, joined Dec 2005, 135 posts, RR: 0
Posted (8 years 9 months 1 week 4 days 13 hours ago) and read 6393 times:

Hope this is not true!!

Will Air India ever get this deal done?

IIRC, Indian Air's Airbus order took three years to get approval.

I don't mean to disrespect anyone, but is this the common practice for Indian government to do business?  confused 

Quote:

The government seems to be inspired by the Indian Airlines (IA) case, where it could save a considerable sum after renegotiate with Airbus for the supply of 43 aircraft. The deal, closed at Rs 9,890 crore in September ’05, saved Rs 349 crore ($75m). The re-negotiation was done by an empowered-Group of Ministers chaired by finance minister P Chidambaram.

http://economictimes.indiatimes.com/articleshow/1332900.cms


Treat others like you'd like to be treated!
34 replies: All unread, showing first 25:
 
User currently offlineManni From South Korea, joined Nov 2001, 4221 posts, RR: 22
Reply 1, posted (8 years 9 months 1 week 4 days 13 hours ago) and read 6370 times:

Hmmm, maybe they got a phonecall from Dixon? Or perhaps Leahy... pointing out what QF payed for their 787's.  Silly


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User currently offlineLeelaw From , joined Dec 1969, posts, RR:
Reply 2, posted (8 years 9 months 1 week 4 days 13 hours ago) and read 6331 times:

Quoting Manni (Reply 1):
maybe they got a phonecall from Dixon? Or perhaps Leahy... pointing out what QF payed for their 787's.

They don't need to get a phone call from anyone, they read the papers and browse the internet. The OEMs have to be prepared to accept the likelihood of ponderous negotiations and governmental approval processes if they want to do business with this airline.


User currently offlineGARPD From UK - Scotland, joined Aug 2005, 2659 posts, RR: 4
Reply 3, posted (8 years 9 months 1 week 4 days 12 hours ago) and read 6300 times:

Quoting Manni (Reply 1):
Hmmm, maybe they got a phonecall from Dixon? Or perhaps Leahy... pointing out what QF payed for their 787's

More sour grapes eh?



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User currently offlineManni From South Korea, joined Nov 2001, 4221 posts, RR: 22
Reply 4, posted (8 years 9 months 1 week 4 days 12 hours ago) and read 6231 times:

Quoting GARPD (Reply 3):
More sour grapes eh?

Woow, lighten up already... if a good laugh isn't allowed anymore...



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User currently offlineLeskova From Germany, joined Oct 2003, 6075 posts, RR: 70
Reply 5, posted (8 years 9 months 1 week 4 days 11 hours ago) and read 6185 times:

Is the Indian government really so obsessed with using every even remote possibility of making AI the laughing-stock of the industry?

I mean, seriously, this has to end - actually, it should have ended a while ago!!!

Quoting GARPD (Reply 3):
More sour grapes eh?

Oh lord... what can you say to a comment like this one, except...  Yeah sure


Regards,
Frank



Smile - it confuses people!
User currently offlinePanAm_DC10 From Australia, joined Aug 2000, 4162 posts, RR: 89
Reply 6, posted (8 years 9 months 1 week 4 days 11 hours ago) and read 6164 times:
AIRLINERS.NET CREW
COMMUNITY MANAGER

Not that I can provide a source, just my opinion. I'll say this deal is closed by year end and on the books at Boeing by Dec 31st.

To those who want a source, I can't provide one. It is simply my opinion. If wrong, I understand the taste of crow is better baked than boiled.  Smile

Regards, PanAm_DC10



Ask the impossible to achieve the best possible
User currently offlineLAXDESI From United States of America, joined May 2005, 5086 posts, RR: 47
Reply 7, posted (8 years 9 months 1 week 4 days 6 hours ago) and read 5933 times:

Quoting PanAm_DC10 (Reply 6):
Not that I can provide a source, just my opinion. I'll say this deal is closed by year end and on the books at Boeing by Dec 31st.

It certainly will happen by the time George Bush visits India early next year. This deal will go through.


User currently offlineNYC777 From United States of America, joined Jun 2004, 5762 posts, RR: 47
Reply 8, posted (8 years 9 months 1 week 4 days 6 hours ago) and read 5905 times:

Indians (speaking as one, of course) are always trying to negotiate the price down to the very last penny...we're very cheap this way. Not something people outside of India understand to well...it's just an Indian thing.


That which does not kill me makes me stronger.
User currently offlineHAWK21M From India, joined Jan 2001, 31684 posts, RR: 56
Reply 9, posted (8 years 9 months 1 week 3 days 14 hours ago) and read 5677 times:

First Delays
Then Bargaining.
Hopefully the Deal is Inked latest by Feb 2006.
regds
MEL



Think of the brighter side!
User currently offlinePanAm_DC10 From Australia, joined Aug 2000, 4162 posts, RR: 89
Reply 10, posted (8 years 9 months 1 week 3 days 14 hours ago) and read 5664 times:
AIRLINERS.NET CREW
COMMUNITY MANAGER

Quoting HAWK21M (Reply 9):
First Delays
Then Bargaining.
Hopefully the Deal is Inked latest by Feb 2006.
regds
MEL

Does that mean I'll have to roast my crow instead?  Smile

Regards, PanAm_DC10



Ask the impossible to achieve the best possible
User currently offlineJacobin777 From United States of America, joined Sep 2004, 14968 posts, RR: 59
Reply 11, posted (8 years 9 months 1 week 3 days 14 hours ago) and read 5629 times:

Quoting NYC777 (Reply 8):
.it's just an Indian thing.

Indo/Pak thing.........in other words........."DESI-POWER".... Silly



"Up the Irons!"
User currently offlineLH459 From United States of America, joined Aug 2005, 886 posts, RR: 1
Reply 12, posted (8 years 9 months 1 week 3 days 3 hours ago) and read 5411 times:

Quoting NYC777 (Reply 8):
Indians (speaking as one, of course) are always trying to negotiate the price down to the very last penny...we're very cheap this way. Not something people outside of India understand to well...it's just an Indian thing.

I've encountered this many times with Desi clients--as you say, it's just an Indian thing, and it's just the way it is! I don't mind anymore. In fact, I've learned to work with it, which is why I'm the only one in my office with a strong Desi clientelle base!



"I object to violence because when it appears to do good, the good is temporary; the evil it does is permanent" - Ghandi
User currently offlineNYC777 From United States of America, joined Jun 2004, 5762 posts, RR: 47
Reply 13, posted (8 years 9 months 1 week 3 days 3 hours ago) and read 5384 times:

Quoting LH459 (Reply 12):
I've encountered this many times with Desi clients--as you say, it's just an Indian thing, and it's just the way it is! I don't mind anymore.

But it's still embarassing nontheless. I wish that once Indians have negotiated a deal they stick with it!



That which does not kill me makes me stronger.
User currently offlineDL021 From United States of America, joined May 2004, 11447 posts, RR: 75
Reply 14, posted (8 years 9 months 1 week 3 days 3 hours ago) and read 5355 times:
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Quoting NYC777 (Reply 13):
I wish that once Indians have negotiated a deal they stick with it!

I know it's a fundamental cultural difference, but it's really difficult to do business with someone raised in a society where a deal is never a deal. Speaking as one who has spent a good bit of time negotiating with Asians from the old country I'll say that a handshake is worth much much less than a cashed check. It's not perfect elsewhere, but damn, it sometimes appears that India wrote the book on how to make things difficult. It leads to bad feelings.

That said, I'd be surprised if Boeing was surprised since the Indian government just got away with this over at Airbus. Even though there was some anger behind that renegotiation the Govt saw some reduction in prices and decided that was the way to go from now on.

[Edited 2005-12-16 21:25:15]


Is my Pan Am ticket to the moon still good?
User currently offlineJaysit From , joined Dec 1969, posts, RR:
Reply 15, posted (8 years 9 months 1 week 3 days 2 hours ago) and read 5313 times:

Quoting UALMMFlyer (Thread starter):
I don't mean to disrespect anyone, but is this the common practice for Indian government to do business?

Yes.
Its taken India over 50 years of independence from Britain to build a single decent modern highway.

Quoting DL021 (Reply 14):
I know it's a fundamental cultural difference, but it's really difficult to do business with someone raised in a society where a deal is never a deal. Speaking as one who has spent a good bit of time negotiating with Asians from the old country I'll say that a handshake is worth much much less than a cashed check. It's not perfect elsewhere, but damn, it sometimes appears that India wrote the book on how to make things difficult. It leads to bad feelings

True enough, but both Boeing and Airbus know who they're dealing with. And while the Indians in the Indian government in the past were just lazy and stupid and corrupt and had no idea why airplanes were even needed, the current lot seem to be crafty in their ability to play up the "we're Indian, this is the way we do things, give us your best price" schtick to their advantage.


User currently offlineMariner From New Zealand, joined Nov 2001, 25269 posts, RR: 85
Reply 16, posted (8 years 9 months 1 week 3 days 2 hours ago) and read 5311 times:
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Quoting Leelaw (Reply 2):
they read the papers and browse the internet.

That could be part of the problem - especially if they read airliners.net.

cheers

mariner



aeternum nauta
User currently offlineAtmx2000 From United States of America, joined Oct 2004, 4576 posts, RR: 37
Reply 17, posted (8 years 9 months 1 week 3 days 1 hour ago) and read 5235 times:

Quoting Jaysit (Reply 15):
True enough, but both Boeing and Airbus know who they're dealing with. And while the Indians in the Indian government in the past were just lazy and stupid and corrupt and had no idea why airplanes were even needed, the current lot seem to be crafty in their ability to play up the "we're Indian, this is the way we do things, give us your best price" schtick to their advantage.

Of course Boeing could note that QF decided that they were going to send out an RFP for a megaorder (and turned out to be megaorder of a single family) to get better prices. Boeing should say we are willing to make a similar deal if you increase your order size. 45 787s with options for 70 more for AI! 42 777s for AI!



ConcordeBoy is a twin supremacist!! He supports quadicide!!
User currently offlineGr8Circle From Canada, joined Dec 2005, 3107 posts, RR: 4
Reply 18, posted (8 years 9 months 1 week 3 days 1 hour ago) and read 5206 times:

Quoting NYC777 (Reply 13):
But it's still embarassing nontheless. I wish that once Indians have negotiated a deal they stick with it!

What's wrong in negotiating for the best price...? It's government (ie. the people's) money they're spending....got to do the most responsible thing, right? Of course, I'm not condoning the loss of business and image that AI has suffered due to delayed fleet modernisation and expansion....but you guys can't just fault the govt. for trying to spend public money in the best possible manner...

Some airlines will complete their requirement study to order placement cycle much faster and some , like the govt. owned airlines, will take longer.....

Cos. like Boeing and Airbus have to be patient if they want to close multi-billion dollar deals for their products....if they're too impatient, they can just step back and let the other guy take the order...do we ever see that happening???? NO WAY!!!!


User currently offlineSammyk From United States of America, joined Oct 1999, 1690 posts, RR: 0
Reply 19, posted (8 years 9 months 1 week 2 days 23 hours ago) and read 5121 times:
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Quoting Gr8Circle (Reply 18):
....but you guys can't just fault the govt. for trying to spend public money in the best possible manner...

Right, and all of a sudden this is a concern of the government? This is most likely another round of pocket lining rather than price negotiations.


User currently offlinePA110 From United States of America, joined Dec 2003, 2006 posts, RR: 23
Reply 20, posted (8 years 9 months 1 week 2 days 23 hours ago) and read 5097 times:
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Quoting Gr8Circle (Reply 18):
It's government (ie. the people's) money they're spending....got to do the most responsible thing, right? Of course, I'm not condoning the loss of business and image that AI has suffered due to delayed fleet modernisation and expansion....but you guys can't just fault the govt. for trying to spend public money in the best possible manner...

 rotfl 

Uh oh, gotta raise the BS flag here!  redflag 

Sorry to be so cynical, but the GOI is not doing this to get a better deal for the Indian public. A few government officials are most likely doing it to see how they can better skim a few extra rupees off the top for themselves. GOI has never been that altruistic.



It's been swell, but the swelling has gone down.
User currently offlineBlrsea From India, joined May 2005, 1423 posts, RR: 3
Reply 21, posted (8 years 9 months 1 week 2 days 22 hours ago) and read 5039 times:

GOI actually managed to reduce the airbus price by around $50 million for IC after renegotiation, and got them to agree to a maintenance or trng center in India. So, I don't fault them for renegotiating with Boeing for IA order too. And in India, the CAG has to audit the accounts and report back to Parliament. Pocket lining doesn't happen when the govt team negotiates with a company. It will most likely be done through intermediaries with as few people involved as possible  Wink

User currently offlineSammyk From United States of America, joined Oct 1999, 1690 posts, RR: 0
Reply 22, posted (8 years 9 months 1 week 2 days 22 hours ago) and read 5021 times:
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Quoting PA110 (Reply 20):
A few government officials are most likely doing it to see how they can better skim a few extra rupees off the top for themselves.

Rupees? I doubt they want rupees.


User currently offlineDarthRandall From United States of America, joined Mar 2005, 302 posts, RR: 3
Reply 23, posted (8 years 9 months 1 week 2 days 21 hours ago) and read 4971 times:

What an unexpected turn of events! Apparently dealing with Air India is like trying to sign an athlete represented by Drew Rosenhaus.

Quoting LAXDESI (Reply 7):
It certainly will happen by the time George Bush visits India early next year. This deal will go through.

As long as Rove has the forethought to remind George that it isn't a good idea to try to endear himself to the locals by displaying his "hogtieing" skills with their cows.

Quoting Mariner (Reply 16):
That could be part of the problem - especially if they read airliners.net.

A winner is you!



Ninjas can kill anyone they want! Ninjas cut off heads all the time and don't even think twice about it.
User currently offlineSubkk From India, joined Dec 2005, 35 posts, RR: 0
Reply 24, posted (8 years 9 months 1 week 2 days 17 hours ago) and read 4861 times:

Hi

I guess they realised that, still few concessions could be worked out. Suddenly with all big ticket purchases for commercial airplanes and defence deals, GOI seems to have realised that they could save few pennies more if they try and renegotiate. Else the order goes to competitor. Just pure commercial sense for once.


25 PlaneDane : It seems to me that using this renegotiating tactic could easily backfire in a big way on the Indian Government this time around. This time, the orde
26 Post contains images StuckInCA : Haha! My ribs hurt after reading that. Nice!
27 Post contains images Gr8Circle : Notice how the words 'this is most likely' keeps appearing in the postings you guys make...thanks for admitting that what you are saying is just your
28 Sammyk : Obviously none of us were in the room during negotiations but saying "most likely" does not mean it is just our imagination. To think that the Indian
29 Gr8Circle : You're just answering your own question....I don't think you're in a position to pass judgement on governments.....
30 Sammyk : And you are? You're making an assumption just like others, just in the opposite direction. Just that what most are assuming is probably closer to rea
31 Blrsea : Amount has been saved earlier in the IC deal, and no doubt something will be saved here too. Plus during the IC negotiation, they got airbus to open
32 LH477 : If AI can get away with it...good for them, all the power to them. As far as Indian negotiators...you'd want one your side, and not on the other side.
33 Sammyk : I never said that they wouldn't be able to save money or that it was even a bad thing to try. I also didn't say all gov't employees were bad. I just
34 Post contains images HAWK21M : Ever spoken to a Mx Stores Mgr on the 0.1% of commission offered by a vendor regds MEL
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