The move will help the company beat Dubai-based Emirates, which carried the highest inbound and outbound air freight in 2013-14.
Mumbai-based Jet is making a major bet on air cargo because it expects India’s manufacturing story to see a strong upswing on the back Prime Minister Narendra Modi’s Make-in-India campaign, and there is a major vacuum in the industry because no major domestic carrier today has its own long haul cargo fleet.
Business Standard had learnt that the Naresh Goyal promoter carrier has already trained local personnel for this new business arm, while appointing a European Etihad executive, James Gilliard, as the Manager (Cargo) for the Asia-Pacific region based out of Singapore last April. The plan is to start with a wet lease of one A330-200F in the next few months, and later expand the business with more aircraft. As the business grows, the aircraft would be converted into dry leases.
“A wet lease would make sense while testing waters, especially with the US Federal Aviation Administration downgrade that prevents addition of new flights to the US. Jet will get the pilots from Etihad along with the aircraft. James is currently responsible for scouting cargo business opportunities in the Southeast Asian region,” a person close to the development said.
Responding to detailed emailed queries, a Jet Airways spokesperson said, “We do not wish to comment on your queries at this stage.”
“India is easily among the biggest opportunities for air cargo business, where the competition is very limited. And with the Make-in-India campaign, one can expect a huge growth in export sectors such as pharmaceuticals, auto and electronic equipment,” an executive with a global carrier, which offers air cargo services in India told BS.
In 2013-14, Emirates was leader in the air freight business by carrying 184,753 tonnes, of which the bulk 131,748 tonnes was outbound cargo. Jet trailed with total air cargo business 120,821 tonnes, of which outbound accounted for just 67,186 tonnes. Air India was a distant third with total business of 95,473 tonnes. In 2013-14, the India’s international freight traffic grew 2% to 1,261,542 tonnes.
The Jet Airways scrip at the BSE closed 4.69% up to Rs 460.15 on Friday.