Exclusive—On Friday this week the Association of Asia Pacific Airlines hosts its grandly titled Assembly of Presidents meeting at the Ritz-Carlton hotel in Bali, Indonesia. The timing is not fortuitous.
      Bali’s Ngurah Rai International Airport, one of the busiest in South East Asia due to the island’s draw as a global tourism destination of some renown, has only been open intermittently since the start of November. The cause? An erupting volcano on the neighboring island of Lombok.
      Mount Rinjani has been blowing dangerous, high altitude volcanic ash clouds in the direction of Bali, which has meant Ngurah Rai has only been open during small windows when the wind has shifted direction away from the Island of Gods, as Bali is known. By November 4, almost 700 flights were cancelled and the number has since rapidly climbed.
      This has left thousands of travelers stranded for extended periods both in Bali and around Asia. It took your correspondent six days to travel from the UK to Bali via Dubai, Jakarta, Singapore and Surabaya and, from there, overland and finally by ferry.
      The AAPA did not respond when FlyingTypers queried whether it was expecting its Assembly of Presidents conference to proceed smoothly and with all participants. Of more import, apart from the disastrous impact the ash clouds are having on tourism in Bali, the chaos is also proving disruptive for the air freight industry and those that rely on it.
      Bali is home to the production factories for a thriving number of internationally renowned jewelry and luxury fashion brands and most rely on air freight to reach global export markets. “We air freight shipments to Amazon who handle our logistics distribution for us as orders come in,” said one jewelry exporter that mainly sells into North America. “But at the moment we can’t replenish our inventory in the run up to the holiday season because we can’t get stock out on a regular basis.
      “We’re also still trying to locate some of our orders and we can’t tell if they’re at Ngurah Rai or if they’ve been flown out already.
      “There is not a lot of information forthcoming from airlines, customs, or the airport. The integrator we occasionally use also seems to have lost some of its usual visibility. They can’t track and trace all the stock we have in their system.”
      Asked to explain how it was easing the impact on customers, the cargo department of Garuda Airlines, Indonesia’s national carrier, would only say that it had made “contingency plans” for the latest eruption.
      Unfortunately for Bali’s luxury goods export industry, and perhaps also for the AAPA’s schedule, there is no end in sight to the eruptions on Mount Rinjani—the last time the volcano suffered a similar event was in 2009 and it lasted for 15 months.
      To make matters worse, exporters with factories in Bali are being hurt for the second time this year by volcanic ash. In the summer Ngurah Rai International Airport also suffered frequent closures due to a volcanic eruption near Mount Raung on the tip of Java closest to Bali. This threw up vast amounts of corrosive silica-based ash cloud and caused travel and freight disruption for much of July and August.       The mountain is still rumbling, casting a pall over the surrounding region and threatening to cause more chaos in the future.
      One exporter of luxury handbags based in Bali told FlyingTypers volcanic ash uncertainty was a huge expense and risk for SME exporters that relied on air freight to reach market. “We missed a deadline for getting samples to Vogue in Italy during the Raung eruption, and we now have orders that need to go out to customers but can’t due to Rinjani,” she said. “If they can't fly out, our orders get cancelled and we're stuck with the stock and a terrible reputation for delivering late.
      “Ash clouds have a massive impact on our business!”
      They may also have a massive impact on the AAPA’s grand event.
SkyKing

      Blue Dart, India’s only domestic jet freighter-express air and integrated transportation and distribution company, will have to wait for the beginning of next year to add an additional Boeing 757-200 to its present fleet of five, which currently provide a network payload of 300+ tons across 60 routeconnections each day.
     In a move to enhance its cargo capacity, Blue Dart was thought to havethe additional aircraft operational this year and had even secured approval from its shareholders during the company's 24th annual general meeting (AGM) held this past July.
     In a note to the Bombay Stock Exchange, Blue Dart declared:
     “It is proposed to add one aircraft during November 2015, to increase the air carriage capacity which will result in increased cost of operation.”
    Reached as we went to press, Managing Director of Blue Dart Aviation Ltd. Tulsi Nowlakha Mirchandaney kept it sweet and simple, telling FlyingTypers:
     “We are planning on augmenting our fleet with an additional B757 and the conversion is in progress.
     “Required regulatory approvals have been sought.”

Online In The Air

     A leading player in the domestic express cargo services industry, Blue Dart, along with its wholly owned subsidiary, Blue Dart Aviation (this is the company that will be inducting the new aircraft), is well aware of the huge volumes online retail will provide.
     In addition to the new aircraft, the company is arranging new warehouses and going into hi-tech.
     It’s little wonder that Chief Executive Officer of DHL eCommerce Malcolm Monteiro (Blue Dart is part of the Deutsche Post DHL Group and Monteiro oversees Blue Dart's operations) was recently quoted as saying that “up to five years ago, you never had e-commerce figuring in BlueDart’s list of top five verticals, and today it is the largest vertical and demand is far outstripping supply.”

e-Sector Soars

     The e-tail sector has been witnessing phenomenal demand from across India.
     In fact, Deutsche Post DHL announced some time ago that itwould invest more than 100 million euros in the country over the next two years.
     A large part of the investment is being earmarked to facilitate services related to e-commerce and Blue Dart was preparing to get on to the e-commerce wave.
     Managing Director of Blue Dart Express Limited Anil Khanna said:
     “There has been exponential growth in the last three years.”
     He also mentioned that in 2010, while e-tailing deliveries did not constitute even one percent of Blue Dart’s business, “now, 25 percent contribution comes from this segment.
     “We expect it to account for half our total business or even more in the next 4-5 years. Business from e-tailers has seen a CAGR of 87 percent for us in the last five years,” he said.

Parcel Locker Goes 24/7

     The Indian e-tailing industry is expected to grow 52 percent from 2014 to 2020.
     In another major initiative to woo online retailers, Blue Dart recently launched the country’s first Parcel Locker.
     The first such locker—stationed in the tech city of Gurgaon (a suburb of Delhi)—will allow recipients of parcels to collect their shipments from the facility 24 hours a day. The mechanism will benefit e-tail customers who may not be present during regular delivery hours.
     The service will also be beneficial for those who travel often, especially with the festive season around the corner.
     “While e-tailing offers customers the opportunity to shop around the clock, with Parcel Locker Blue Dart will offer the convenience of a 24-hour-a-day/7-days-a-week/365-days-a-year delivery mechanism,” Mr. Khanna told FlyingTypers.
     Used extensively in Germany and other countries, the service utilizes mobile technology in tandem with specially designed lockers to ensure customers get all-day access to their shipments from a safe, secure, and convenient facility.
     Blue Dart hopes to woo customers with the facility as well as its wide network.
     The locker service will be free for customers and will be offered to all the e-commerce vendors Blue Dart works with like Amazon India, Snapdeal, and Flipkart.
     Shares of India’s major logistics and delivery companies have surged in the past 12 months, partly due to e-commerce demand. Blue Dart has more than doubled to Rs.6,916.30, while Gati Ltd, in which Japan’s Kintetsu World Express Inc. has a stake, has more than quadrupled to Rs.253.90, according to data compiled by Bloomberg.
Tirthankar Ghosh

Better News Rising . . . International Airlines Group (IAG), owner of both Iberia and British Airlines, raised their outlook of profit for 2015 late last month following better-than-expected 3rd quarter results and stronger flight demands during the summer.

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