| Gati,
Air India Cargo eye Blue Dart market share
15 November 2007
Indian
logistics major, Gati, has signed a joint venture pact with Air India Cargo in
a move aimed at providing competition in the domestic cargo aviation space to
Blue Dart Express, owned by DHL, a unit of German postal services giant Deutsche
Post. Gati
managing director and chief executive, Mahendra Agarwal, said that his firm would
lease up to five freighter aircraft by March 2008 from Air India Cargo, a unit
of state-run National Aviation Company Ltd (NACIL). He added that the aim was
to garner 11 per cent market share by December 2008. According
to Agarwal, the freighters would help the company carry more cargo with no restrictions
on timings, quantity or type. For Gati this is a move up in the airfreight business,
as it will now transit from hiring limited space in the belly of passenger aircraft
to leasing an entire plane's capacity. The
capacity increase would enable Gati to carry more perishable commodities, such
as flowers and vegetables and refrigerated products like pharmaceuticals. India's
domestic air cargo industry, which is dominated by Blue Dart Express, has been
growing at a compounded growth rate of over 11 per cent over the past five years.
According to
estimates, a booming economy may see domestic air cargo grow to 500,000 metric
tonnes by March 2008, at a 20 per cent growth rate every year, over the next five
years. Gati expects
the share of its aviation cargo business to double to 20 per cent in the fiscal
year to June 2009, with revenues reaching $254 million.  Air
India Cargo will continue to run its own logistics business separately and expects
cargo operations to contribute a revenue of $228 million in the fiscal year to
March 2008.
Gati
plans to have a fleet of 10 freighters by July 2008.
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