Brazilian aircraft maker Embraer ties up with Hindalco to secure aerospace-grade aluminium

Brazilian aircraft manufacturer Embraer SA has signed a second memorandum of understanding with Aditya Birla Group’s metals flagship Hindalco Industries, aiming to identify local partners and suppliers.

This comes a little less than a month after Embraer and Gautam Adani-led Adani Defense & Aerospace signed an MoU on January 27 to manufacture regional transport aircraft in India. The collaboration aimed to develop a local ecosystem, including a final assembly line (FAL).

The MoU, announced on Friday, aims to identify opportunities in the production of aerospace-grade aluminum raw materials to support Embraer’s industrial initiatives, the planner said in his statement.

“This joint action reinforces our focus on identifying local partners who can be our suppliers, and in doing so accelerates the development of the Indian industrial base,” Roberto Chaves, Embraer’s vice president of global purchasing and supply chain, said in a statement.

The company added that India represents a strategic market for Embraer across all its business units.

Arjan Meijer, President and Chief Executive Officer of Embraer Commercial Aviation, previously told Mint that FAL will produce smaller aircraft suitable for the country’s regional connectivity.

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Embraer, the world’s third largest civil aircraft manufacturer after US Boeing and European manufacturer Airbus, produces the Embraer Regional Jet and E-Jet narrow-body aircraft families for short- and medium-haul routes. The company also produces business jets, defense aircraft and agricultural aircraft.

If it sets up a FAL in India, it will be the first among the three global aircraft manufacturers to assemble aircraft locally. Boeing and Airbus currently source components from Indian suppliers but do not have aircraft assembly facilities in the country.

Novelis is already an aero supplier

Hindalco’s US subsidiary Novelis already supplies materials to the aerospace sector, making the Indian company an ideal source for aerospace-grade aluminium, an analyst said. “This existing talent and global presence can help Embraer build a reliable local supply chain as it expands its footprint in India,” said Suman Kumar, vice president of metals and mining at broker Philip Capital.

Currently, Star Air, a private company owned by Ghodawat Enterprises Pvt Ltd, is the only Indian airline to operate the Embraer fleet of eight jets. The Sanjay Ghodawat-backed airline is expected to place additional orders for Embraer aircraft in the coming days.

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India has witnessed a growing push for regional connectivity through the UDAN Programme. It subsidizes fares and mandates price caps to make flying affordable and encourage small-town connectivity.

Star Air, FLY91, IndiaOne and Alliance Air are among India’s airlines focusing on regional routes. IndiGo, Akasa and SpiceJet also operate on certain routes.

Another expert said local production of aerospace grade aluminum will reduce import dependency and address the raw material base in the supply chain. “This will ensure that future aircraft programs can source key inputs domestically,” said Ashish Chhawchharia, partner and aviation industry leader at consultancy Grant Thornton Bharat.

“More MoUs are expected in avionics, composites and MRO services as Embraer builds a complete ecosystem. This creates opportunities not only in aviation but also metals, engineering and IT services,” Chhawchharia added. MRO is the abbreviation for maintenance, repair and overhaul services.