Tuesday, 29 June 2010
More airlines in India focus on belly cargo
Though the slew of cargo airlines that are waiting in the wings may need more time to take to the skies, the air cargo business, which act as a barometer of airline industry, is picking up, the Economic Times of India reported. According to industry experts, the business activities are also expected to get a leg up with a number of airlines planning to augment their India services. According to International Air Transport Association (IATA), the financial situation for the air cargo business appears to be improving significantly. With this, global and domestic carriers are adding either new destinations or enhancing the existing flights on the existing routes. IATA expects airlines to post a global profit of US2.5 billion in 2010. This is a major improvement compared with its previous forecast released in March of a $2.8 billion loss. This confidence is triggering airlines to deploy more capacity into the market. From October 29, Lufthansa Airlines, Swiss International Air Lines (Swiss) and Austrian Airlines will offer even more flights from seven Indian destinations to Frankfurt, Munich, Zurich and Vienna, with a total of 75 weekly frequencies. Most of these carriers have huge exposure to air cargo business. The new destinations and new flights are translating into more planes, which in turn, will add more belly space for more cargo. "Passenger airlines have already identified cargo as a major revenue-generating source and India is a great market both in terms of domestic and international. They are optimising the potential of its otherwise empty belly space to bring in cash by offering cargo services at rates considerably lower than dedicated freighters by tapping their extensive network and flight frequencies to reach more destinations and achieve faster delivery time. Airlines are also counting on cargo revenue as a part of protecting its bottom line against fluctuations in fuel prices," said an air cargo consultant. "Since passengers airlines are enhancing its capacities, the take off of dedicated freighters will be delayed. If you notice passenger airlines are increasingly tying with Indian exporters, importers and logistics companies to offer services at the speed of a courier company," said the consultant. source: cna
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