“AVI Oil’s  global strategy is to increase the footprint for the civil aviation market along with developing new technologies to support the shift of the aviation industry to a more sustainable operational environment”

Defstrat: AVI-OIL is one of the leaders in India for lubrication products in Civil Aviation, Defence and Gas Turbines (ground). Which are the technologies and products which stand out as AVI’s niche products?

VKM: AVI-Oil is a joint venture between Indian Oil, Balmer Lawrie, and Nyco, France. Nyco, France is the sole European producer of aviation lubricants and is an expert in the development of synthetic ester-base stocks.

In India, AVI-Oil is one of the key suppliers to the Aviation and Gas Turbine markets. Most of the Aviation lubricants are based on synthetic ester technology. We also promote these synthetic esters to customers who can use it as base fluids or additives for specific lubricant requirements.

We have a wide range of products in our portfolio. For the Aviation field, we have the complete product range of Engine Oils /Turbine Oils, Hydraulic Fluids, Greases & Speciality products. On the Industrial & Automotive side we have a range of polyol esters and complex esters which we promote to various oil companies, who use it in their formulations. We also have a few fully formulated products that we market directly or offer for re-brand.

This portfolio of high-performance niche products are used in specific applications for Aviation, Industrial & Automotive applications.

Defstrat:  In the age of Aatamanirbharta, how much is the company dependent on foreign assistance by way of raw materials, technologies and processes? What steps is AVI OIL taking to increase the domestic percentage in its products?

VKM: NYCO, France, provides the technology to produce the complete range of lubricants required for the military aircraft of Western and Russian origin. In addition, products required for civil aviation are also covered, be it for commercial airline’s fleet or smaller aircraft operated by flying clubs etc. The technology transfer also covers expertise in production of niche high quality synthetic esters.

Aviation lubricants require approvals from the equipment manufacturers and these approvals are rendered only for specific manufacturing processes and raw material sources. Hence change of raw material sources is not permitted at random.

However, we have been successful in progressively getting Indian raw material sources approved where available and feasible. Many of the raw materials are just not made in India or do not have the requisite quality and consistency and this becomes an impediment to us in our quest to indigenize raw materials.

Defstrat: Civil and Military aviation are constantly growing as is the variety of aircraft that are operating in this space. Given this boom in the aviation industry, how has the scenario changed for Avi-Oil and how do you prepare for the new challenges?

VKM: While there is a general boom in the aviation industry, the scenarios are vastly different in the military and the civil aviation sectors. With the induction of so many types of new aircraft and the ongoing phasing out of the aging aircrafts, the fleet of the defence forces is changing dramatically and will continue to do so in the next five years. We are proactively working with concerned OEMs to get our products approved so that when these aircraft are inducted, we are also ready with their lubricants. Apart from getting our products approved for the new inductions, we also need to get these products approved by the `Centre for Military Airworthiness and Certification’ (CEMILAC).

A hurdle we face is that under pressure from the foreign aircraft OEMs, the services are reverting to sourcing the lubricants from their country of origin, even though the indigenous analogs have provided satisfactory performance and services for the last couple of decades.

The Civil Aviation sector globally is probably one of the sectors that has been hit hardest because of the COVID-19 pandemic. The last three years saw substantially limited activity in the sector globally as well as in India.

Due to the impact of COVID-19, the global picture of the aviation industry has significantly changed during these two years. The business model drifted from the massive “hub” operated with high density aircrafts to a more “point to point” model where smaller aircrafts and more sustainable ones have become the trend. We have seen multiple airlines accelerating the phase out of their B747s and A380s, replaced by the new and smaller generation A350s & B787s. The new capacities and range of the A321 XLR or B737 MAX are also bringing opportunities to operate long-haul routes with narrow bodies, thus increasing the airline’s profitability along with reducing the environmental impact. The major driver for this change is sustainability. This new business model gives the opportunity for new players to enter with several new airlines starting operations like Akasa Air in India, Flair Airlines in Canada and Norse Atlantic in Norway.

Our global strategy is to increase the footprint for the civil aviation market along with developing new technologies to support the shift of the aviation industry to a more sustainable operational environment. A recent strategic partnership signed between NYCO and Air France is a clear commitment to develop and support this sustainable ambition.

In India, AVI-OIL offers a comprehensive range of turbine oils, hydraulic fluids, multi-purpose greases and lubricants for helicopters, business jets and aircraft. We offer high performance products as well as cost-effective, customized solutions to meet the needs of our customers.

Our products are approved by major OEMs like Safran, CFM, GE, Rolls Royce, Pratt & Whitney, and Pratt & Whitney Canada etc. and air framers like Airbus, Boeing, Bombardier, ATR, Eurocoptor, Dasault Aviation, Embraer and many others. AVI-OIL is approved by the Directorate General of Civil Aviation (DGCA) under Section 2, Category ‘E’ of CAR.

AVI-OIL is well positioned to provide domestically produced products to shorten lead times, provide better cost economics and far superior technical services on the ground.

Defstrat: Despite domestic production and standards of Oil and lubricants improving, we continue to import a large number of lubricants. What steps is AVI OIL taking to improve further to match foreign rivals in terms of quality and endurance?

VKM: In the military sector, the defence forces have largely indigenized their requirement of aviation lubricants and are currently being serviced by

Avi-Oil. However, there are a few instances when the defence forces do import, mainly for aircraft under warranty or under specific instructions from the foreign OEM. In the civil aviation sector however, the scenario is different with the bulk of their requirements being met by imports.

Aviation lubricants necessarily must conform to the same governing specifications and approval procedures irrespective of the country in which they are produced. There cannot be any compromise on the quality of these products. Avi-Oil has laid emphasis on its quality of products and processes, and today its quality assurance organization is approved by the Directorate General of Aeronautical Quality Assurance (DGAQA) and the Director General of Civil Aviation (DGCA) for military and civil aircraft respectively. Thus, no distinction can be made on the quality of its products vis-a-vis those of its global competitors. In addition, Avi-Oil provides other technical services and logistics support which result in several tangible and intangible benefits to the customers.

It is safe to say that today customers in India are getting used to the fact that products manufactured in India are as good as, if not better than, products manufactured globally.

Defstrat:  As the CEO of AVI OIL what is your vision for the future of the company/

VKM: While our initial objective of ensuring the nation’s self-reliance in the strategic area of Aviation Lubricants has largely been met, we must now look forward to the future.

Our thrust for growth will focus on the Civil Aviation and the Industrial & Automotive segments.  In Civil Aviation, despite the COVID-19 pandemic being a dampener, the market is quickly returning to pre COVID levels and we would like to take benefit of the growing opportunities arising out of this.

In the industrial & automotive sector, the use of synthetics in lubricants is currently very low. This is an evolving market, and we expect to play a major part in this arena as and when the share of synthetic lubricants rises. The industry is certainly changing, and we have seen this happen globally and it is only a question of time when this happens in India too.

Our short-term plans are to consolidate our existing business with the defence forces in India and drive up the financial indicators of turnover and profitability. In the medium term we hope to become a bigger participant in the Civil Aviation sector and the Industrial & Automotive segments, making us one of the leading synthetic players in the country.

At our plant in Faridabad, we have a lubricant blending unit and an ester manufacturing facility which are adequate to meet our current marketing plans. We still have spare capacity for the present and remain flexible to add capacity as required.