Louis Galloisis the CEO of EADS, the European Aeronautic Defence and Space Company, a large pan-European aerospace corporation. The company develops and markets civil and military aircraft, including the Airbus family, the Eurocopter and the Eurofighter, as well as communications systems, missiles, space rockets, satellites, and related systems. A graduate of HEC, France's elite commercial school and the even more prestigious ENA or school of administration, Mr. Gallois has served as President of Snecma, Aerospatiale and the SNCF, France's impressive railway network. He has also held senior posts in the Ministry of Defence.
EADS is in the race to sell military hardware such as the Airbus tanker, the Eurofighter combat aircraft and Eurocopter (military) helicopters to India. Airbus signed a leasing deal worth €5 billion with Air India and Jet Airways during French President Nicolas Sarkozy's recent visit to India. However the deals, to be done directly with the leasing companies, are unlikely to give new business to Airbus.
This interview, with The Hindu's Vaiju Naravane , was conducted in Paris on November 26 but at the express request of Mr. Gallois, its publication was delayed until after President Sarkozy's visit to India.
Is it true that the contract for the Eurocopters fell through because the Americans, who were also bidding, pulled out at the last minute leaving you as the sole bidding party, something that the Defence of India Rules do not permit?
I cannot confirm that since that is an issue regarding the customer, not us. The tender was interrupted. It has been re-launched. We have responded and we are expecting that the decision will be made in a few weeks.
But when the contract or tender was interrupted suddenly — did the Government of India give you no explanation at a ll?
I do not want to enter into this discussion because it is a question of relations between customer and supplier and I think it is for the customer to give you an explanation, not for us.
There is another major contract in the offing which is for 126 MMRCA or the Medium Multi-Role Combat Aircraft — a $10.2-billion contract. How far have you gone in the talks? Have the field trials taken place and is there a cut-off date?
Nobody knows the exact amount because it's a tender and at the end we shall see about the price. However, there is a process underway. We are responding, the field trials have been done and we understand that there will be a short list.
Is it a question of the French Rafale versus the European Eurofighter?
It is not just the Rafale against the Eurofighter. There are the U.S.-built F-16s and F-18s and at least one Russian offer.
That is true. But from the European point of view, there are two products. Would you say President Sarkozy is pushing for the Rafale not only because it is a purely French product but also partly because its manufacturer Mr. Serge Dassault is a good friend of his?
I would not say that. President Sarkozy is promoting a French product. He is not alone.
President Obama was in India a few weeks ago and he was promoting the American product. I think that chiefs of state are engaged in the promotion of products because external trade and exports are decisive for economies and it is perfectly legitimate for them to do so. Mr. Liam Fox, the British Defence Secretary, was in India to promote the Eurofighter. So I do not have any problem with that.
How would you measure the competitiveness of the Eurofighter against the Rafale?
I think it is for the Indians to measure that. We know that the Indian Air Force is extremely professional. They are used to this sort of competition. They have placed very high specifications in the tender and every bidder has to develop new capacities to reach those specifications. Each one, the F-16, the F-18, the Sukhoi, the Rafale, the Eurofighter, each one has to develop new capacities because the specifications requested by the Indian Air Force are currently not available on existing aeroplanes. Perhaps on the F-22, but that is not for export.
How much of an additional investment does that mean for you?
I shall not give any figure but it is clear that for us it is an investment. It will be partly on our back and some of the capabilities could interest our European customers. And if they are interested, they will have to partly finance this.
The Rafale is not a new plane. It has been around for a very long time.
You know, a fighter plane has different standards. And we are developing new standards for the Eurofighter just as the Rafale is developing new standards. I can also say that the F-16 and the F-18, which are older still than the Rafale or the Eurofighter are also developing new standards.
Then how do you account for the fact that not a single Rafale has ever been sold outside French shores?
This is a question that I shall not answer.
What about the Airbus multi-role military tanker? Are you in the running for that too?
We are proposing the tanker to the Indian Air Force. We consider that we have the best product in the world. We have sold it to four countries – Australia, the U.K., Saudi Arabia and the United Arab Emirates. We won all the competitions against Boeing and we won in the U.S. itself in 2008 and now we are proposing this product to India. We think we have the benchmark.
There is of course the question of off-sets. For certain products the Indians are placing the figure as high as 30 per cent or even 50 per cent. How do you go about finding the right collaborators in India?
Off-sets are not an obstacle for us. Our will to invest in India is high and the off-set factor is not a big constraint. We want to invest in India because we feel it is one of the most promising markets in the world, whether for civil products or for military products. We have 250 people in India at the moment; we will have almost 700 people in 2012. To get access to the Indian market we have to invest, that's clear. In India we find the technological resources we are looking for. We are extremely happy with Bangalore where we have not just a design office but a research centre now being developed and we will have a design office for Airbus and Cassidian, our defence division. More globally, EADS has to be built on three pillars — one in Europe, certainly because our roots are in Europe, one in the United States because half of the world defence market and 40 per cent of the aeroplanes flying are in the U.S., but the third pillar has to be in emerging countries. Growth and dynamism will be with the emerging countries in future and India is certainly one of the most promising. It's a country where we can partner with local industry, where we could find technological resources, where we have one of our main partners for space. We are partners on helicopters, on Cassidian (defence projects) — for some products for the Eurofighter and certainly for Airbus. It means our four divisions can work in India and partner in India with Indian companies. The market is equal to the size of the country — huge.
But there have always been questions in India about technology transfer. Doors for the Airbus might be made in India but the strategic items remain a western preserve. When is that barrier going to come down?
I think each company is protecting its intellectual property and we are not different from other companies — we are protecting our know-how, patents, etc. But we are more open than all our competitors in terms of partnership and exchange of technologies. Moreover, we are more used to working in a multicultural environment because the basis of the company is multicultural. I think this is an advantage we could present to the Indian government.
