Vol. 7  No. 71                                         WE COVER THE WORLD                                                            Monday July 7, 2008

Players Change For India Cargo

     When it comes to all-cargo, India for a long time has been the preserve of a few big companies such as Indian and Blue Dart.
     But there has always been a market for belly cargo, which has been addressed by the legacy and low-cost carriers.
     However, the status quo is soon going to change.
     Waiting in the wings are a few homegrown carriers that have at last found their wings, thanks largely to what Capt. Mukut Pathak, (left) Director of Aryan Cargo Express (ACE), described as the "strong growth of the Indian economy".
     Growth in the express market in the country, for example, has risen to soaring heights.
     At a recent conference, Blue Dart Managing Director Tulsi N. Mirchandaney (right) speaking about the air cargo growth story showed how the express market had grown. Internationally, the express sector had 3.5 percent market share of international air cargo in 1991.
     In 2005, that jumped up to 11 percent. Internal estimates by Blue Dart have thrown up some interesting figures.
     The size of the express industry in the country is Rs 4175 cr and the average annual growth is estimated to be 17.2 percent.
     Bangalore-based start-up air cargo player Quikjet is one of the recent entrants in the aircargo sector.
     The carrier's CEO Natesan Ramesh, (;eft) speaking to Air Cargo News FlyingTypers, said:
     "From a low base of a few hundred million rupees, the current express market is estimated at around Rs 27 billion (about USD$650 million) and growing at a blistering 25-30 percent per annum.
     “The past four year period," he pointed out, "has witnessed a spectacular rise in the express business due to high flow of Foreign Direct Investment and MNCs migrating businesses or setting up business in the country."
     Even with India’s open skies policy as far as cargo is concerned, there are opportunities that still remain untapped.
     Ramesh was forthright when he said:
     "We believe that the market is sufficiently underserved.
     "Naturally, whether it is express or plain air cargo, all newcomers hope to take a major bite of the pie.”
     Promoted by AFL Private Limited, a leading logistics company and a pioneer in the express courier sector and Singapore's Cardinal Aviation,
     Quikjet would like to be known as a merchant air cargo carrier that is keen to open up capacity to all players in the market.
     Ramesh believes that Quikjet will achieve what the low-cost carriers have done in the Indian market.
     "Like the low-cost carriers, we are trying to open the cargo space," he said.
     There is Crescent Air Cargo, which after many fits and starts, has started operating daily Fokker flights linking Coimbatore, southern India's major industrial hub to Chennai and Mumbai.
     Crescent has had a checkered career. Based in Chennai, the airline was established in June 2000 by airline pilots. They could not operate it and the company was taken over by Santosh Lad, an industrialist with interests in mining, software, real estate development, the entertainment industry and now air cargo.
     The carrier resumed operations from the middle of 2007.
     Lad, the Chairman and Managing Director of Crescent Air, was upbeat.
     Pointing out the linking of Coimbatore with Mumbai, he said:
     "As we pioneer new routes that expand our global reach and add convenience to industrialists, the Chennai-Coimbatore-Mumbai daily service will offer many important options for business and cargo agencies."
     According to Cresent's CEO, Capt. Murali Ram, Crescent will shortly be starting its freighter operations on the Visakhapatnam-Chennai-Kolkata sector.
     "Our services would be immensely beneficial for the growing markets of shrimp, tuna exports, garment industry and other perishable goods," he said.
     Talking to Air Cargo News FlyingTypers, Ram said: "Crescent is operating with one Fokker F-50 with about 4 to 5 flights in a week lifting about 40 tons of cargo a week.
     “We are mainly flying between Chennai-Visakhapatnam-Kolkata and doing some local charters as well including Medivak operations.
     “Our expansion program is in place and we have finances for our next acquisition of aircraft.
     “We have identified two aircraft with large cargo doors, which should be in operation by end of this year."
     Part of the expansion program deals with flights abroad.
     Ram continues:
     "We are in discussion with consolidators to fly between Colombo-Male-Chennai and Delhi-Kolkata-Dhaka.
     “Once we get our clearances, our next two aircraft will be operating these routes."
     If Crescent has plans to tap the niche market, Capt Mukut Pathak with his yet-to-take-off Delhi-based Aryan Cargo Express (ACE), the first flight would be sometime between mid-August and mid-September this year, is optimistic about the growth in the sector.
     Talking to ACNFT, Capt. Pathak said:
     "Today India has about 400 million people in the middle income group.
     This figure is likely to touch 550 million by 2015 as a result of India turning into a major manufacturing base."
     The retail boom in the country, said Capt. Pathak, is yet to arrive and when that does, it will spurt the demand for movement of cargo by air.
     "The air cargo growth in India has accelerated in the last four years, primarily due to the strong growth in the economy," the Captain emphasised.
     "ACE is entering a segment of air cargo industry that does have any India-based operator.
     “We are more international oriented than domestic," he said.
     In an afterthought, he commented:
     "We will be competing with the real big boys of this game like FEDEX, DHL and UPS."
     More interested in connecting India to foreign nations, Capt. Pathak added:
     "We are looking at the SAARC (South Asian Association for Regional Cooperation) nations—India, Pakistan, Bangladesh, Sri Lanka, Nepal, Maldives, Bhutan and Afghanistan—to be our main market and plan to provide connectivity within SAARC and markets such as China, Far East, SE Asia, ME, CIS and Europe.
     “We will have a domestic network, but that will be only be to feed our international network."
     For such vast operations, Pathak's ACE has worked out a plan to fly with a combination of A310/300-600Fs and MD11Fs.
     He along with his partner promoter Rishiraj Singh Dungarpur has signed the lease for two MD11s from Skyholding. "We plan to launch with three leased aircraft and grow to 12 aircraft within 14 months to acquire a network stability and realize the full potential of our network.
     “We do not forsee much of a problem at airports because we will operate at night within the Indian airspace and during the day, we will vacate this airspace for international flights."
     The competition has not deterred Capt. Pathak and his ACE.
     He was quite candid when he said: "There is enough sky under the sun for everyone.
     “The air cargo boom in India is still a couple of years away.
     "While he does see that for the next 10 years the growth of cargo will ensure success for all the players "unless the industry is hit by some rogue players who may create problems as it happened in the Low Cost Carrier segment in India".
     As for Crescent's Ram, the competition, he said, is not all that much.
     "Competition in the small sector aircraft will not be much since I see most of them are looking big.
     “We want to establish ourselves as a feeder cargo airline and benefit from operating turbo prop aircraft.
     “Once our demand grows we will consider big jets."
Tirthankar Ghosh

     When flyLAL announced 40% increase in cargo transportation volumes for April 2008 some eyebrows were raised undoubtedly by people who maybe were not aware that the carrier founded in 1991 and now privatized actually moved some 331 tons during the first four months of 2008.
     Currently, flyLAL operates direct scheduled flights from Vilnius and Palanga to 21 destinations.
In cooperation with its code-share partners the airline offers passengers and cargo connections between Vilnius and over 200 cities of the world.
     Ms. Lina Rutkauskien is Head of Cargo for flyLAL, formerly Lithuanian Airlines.
     Before joining flyLAL to head its cargo section, Lina gained experience in the air cargo industry working with TNT at Vilnius where she discovered that her certain combination of brains and beauty were dynamite at capturing market share.
     Now at flyLAL, Lina has been instrumental in building up the cargo department, introducing quality control procedures and setting up agreements with GSAs and interline partners.
     “After strengthening the product in the markets it was necessary to offer our customers the same opportunity to track and check shipment status as is offered by competitor airlines,” she said
     When Lina was tasked with finding the best possible Cargo IT solution available in the market it was not long before flyLAL “selected eCHAMP as the preferred system.”
     Presently the cargo department manages 30 general sales agents plus 25 ground handling agents abroad.
     The department also manages the flyLALcargo website, organizes sales campaigns, performs market and competition research and sells to 24 freight forwarders in Lithuania.
     “Thanks to interline agreements with more than 50 airlines, the carrier is able to offer cargo uplift to more than 600 destinations from Lithuania.”
     Lina and her small team of 4 people do all this work.
     But least you might think it is all cargo work—think again.
     Lina still finds time to continue with her studies and is currently in her third year working towards a doctoral degree in economics.
     She also finds time to enjoy life with a significant other, noting that she and her husband, who owns an electricity engineering company, are planning to have children one day.
     Meantime they enjoy music as well as sports and keeping up with current affairs.
     Lina’s other hobby involves her pets.
     She keeps dogs and degus (a small mammal originally from Chile and related to guinea pigs).

Women In Cargo Hall Of Fame

Karen Rondino

Sheryle Burger

Maria Schmucker

Michelle Wilkinson

Susanne Keimel

Beti Sue Ward

Ann Smirr

Suzan Tarabishi

Alexandra Ulm

Maria Muller

Marina Marzani

Iwona Korpalska

Olga Pleshakova

An Air Cargo News/FlyingTypers Original

   Our exclusive series “Women In Air Cargo” asks our readers to send some words and a picture about somebody that you know who is female and has made a difference in air cargo.
  This effort is not limited to just success or failure, it is meant to raise awareness about the legions of unique women who in most cases are unsung heroines in the air cargo industry.
  So write and we will share your story with our readers around the world.

Mamma Mia!
Pizza is served up for July 4th celebration at Camp Victory.

      DHL delivered thousands of freshly frozen pizzas to U.S. servicemen and women serving throughout Iraq in a little taste of home last week in time for July Fourth Independence Day celebrations.
      Retired Master Sgt. Mark Evans, resident of Elk Grove Village, Ill., organized the effort with the support of local veterans and community members.
     Evans collected enough donations to purchase 2,000 pizzas, and DHL donated the air shipment from Chicago to the U.S. military in Baghdad.
     My, my, how can I resist you!

Air India Freighters
Flying Frankfurt

Air India may have made some news last week as some B737 freighters and operations at Nagpur appear on hold at least for a while, but that has not slowed down action for the carrier’s run up in European all cargo lift, especially in and out of Frankfurt to India.
     Wolfgang Scholinz, Air India Cargo Sales Manager in Frankfurt reports that since the return to all-cargo operations last year as an A310F was added to the fleet, business in fact has been building nicely.
     “With the additional freighter flights, we can now meet the strong demand for capacity to and from India.”
     He said the dedicated freighter service complements Air India’s weekly passenger flights from Frankfurt to India—including multiples of 747-400 flights—that see strong demand for belly capacity._
     “Moreover, destinations can be offered at attractive prices.
     “On top of that, our customers benefit from very established handling procedures and the short distances to and from their own consolidation centers (at Frankfurt),” Herr Scholinz said._
     Scholinz declared overall Air India is seeing strong and growing demand for cargo around the world, and will continue establishing its freighter fleet.
     “At present we are converting more AB310F at EADS in Dresden that will
enter service by mid/end August 2008.
     “We are looking at deploying same on India/Europe/India route, but it looks like that FRA will get a daily freighter.
     “There have also been some studies undertaken with an eye to possibly operating into Milano and other cargo-heavyweight airports.”
Contact: wscholinz@airindia.de