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Airbus Looks To Double Core Digital Job From New Bengaluru Centre

European firm looks at leveraging its information management centre in Bengaluru to cut outsourcing.

BENGALURU: Airbus is planning to double the work it does in-house from its new information management centre in Bengaluru, as the passenger aircraft maker looks to consolidate core digital work within the company, top executives told ET.

Currently, the European multinational company does only 20% of its IT work in-house and the internal target is to double that.

“To get from 20% to 40%, we can’t do it from one footprint (in Europe) alone and one of the ways is leveraging our presence in India,” Airbus Group India chief information officer Carlo K Nizam told ET, without disclosing a timeline.

Airbus has over 1,400 people at its Information Management unit in Europe and around 300 in Bengaluru, which will increase to 500 this year. The company, which also makes helicopters, military aircraft and rockets, has an engineering hub that employs over 1,000 people in the same unit.

“We wouldn’t outsource the architecture of the aircraft. In the past, we were heavily outsourcing our neural networks (and) IT systems. Part of what we are insourcing (is) what we consider as roles such as architecture and (in) new skills,” he said.

Nizam declined to comment on the value outsourced or to name the vendors it planned to reduce work from.

In 2018, Airbus sourced aerospace components and services worth around $550 million from 46 vendors across India, with half of that contributed by services, said Airbus India president and managing director Anand Stanley. This will increase to around $600-650 million in 2019, he said. “Our latest information management facility is about value play. It is about insourcing rather than outsourcing. It is about core and not non-core,” Stanley said. Indian IT firms such as Infosys, Wipro, Tech MahindraNSE -0.55 % and Geometric, now owned by HCL Technologies, provide IT as well as engineering and design services to Airbus as part of its Make in India programme, the firm had said in 2016.

DIGITAL PLAY

Technology researcher ISG estimates that Airbus has three R&D services contracts worth $120 million with Tech Mahindra for product design. Airbus also has a large contract with Accenture (around $40 million) and smaller ones with firms like Capgemini ($12 million) for developing and managing digital applications.

Infosys is helping Airbus with SAP ERP services, although details of the deal are not known. Infosys also acquired a Danish AI firm, aimed at providing services to Airbus, it said. Airbus is looking at its Bengaluru centre for bringing inhouse core activities for IT capabilities, both for existing as well as new digital skills.

Global firms such as UBS, NetApp and Symantec have stepped up moving back work from vendors as they look to retain core work in-house. “Switching to insourcing from a outsourcing-dominant business model is not new in the capital-intensive aerospace and defence industry — Airbus’ American competitor, Boeing, is a classic example,” said Avimanyu Basu, lead analyst for engineering services at ISG. Airbus had already expressed interest in intensifying collaboration and establishing a Global In-house Centre is aligned to that, he said.

Source : Economic Times 

Image Source : Business Line

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