Two Indian courier companies to lease Boeing air freighters, enter cargo fray

India's second-largest courier company, First Flight Couriers Ltd, will end the leases on its two small cargo planes. New Delhi-based cargo transportation company Safexpress Pvt Ltd is planning to enter the cargo airline business. Both logistics firms are planning to lease Boeing cargo jets made for their captive use.

First Flight is planning to take Boeing B737 cargo planes on lease in the next three-four months. The company operates from Chennai, Bangalore, Mumbai and Delhi. Safexpress plans to tie up with a South Indian company that will own and operate the aircraft for the logistics major.

The proposed partner, whose identity has not been disclosed, will carry only Safexpress cargo on the three Boeing B737 cargo planes it plans to lease. The tie-up between the two firms will not involve any equity. At present, Safexpress's partner is getting a licence from the ministry of civil aviation.

The Safexpress cargo airline operation will have the Nagpur as its hub. Slated to start early next year, it will go hand in hand with a Rs 700 crore warehouse expansion plan that the company is rolling out.

At present, the DHL-controlled Blue Dart Aviation Ltd is the only company that is running air cargo operations in India, while the Hyderabad-based Flyington Freighters Ltd has announced plans to start domestic and international operations shortly.

Private passenger airlines like Air Deccan, Kingfisher Airlines, GoAir and Jet Airways have also announced plans to enter the segment. The state-owned National Aviation Company of India Ltd (NACIL), which runs the merged Air India, also plans to lease planes from Boeing, apart from converting five old Indian Airlines Boeing aeroplanes into freighters.

Interest in the air cargo business is at an all-time high as domestic cargo has grown more than a third in fiscal 2007, and international cargo movement expanded at an estimated 15 per cent, according to trade statistics from the Associated Chambers of Commerce and Industry of India (ASSOCHAM).