Indian airline IndiGo has picked Heavyweight Air Express (HAE) as its general sales agent (GSA) for the Gulf region, as part of its move to aggressively grow its cargo business between the Middle East and India.
“We are now focusing on growing our cargo business and Middle East is a very important region for us in this drive. We have recently changed our GSA in the region and picked HAE as our new GSA for the region,” Willy Boulter, chief commercial officer of IndiGo, told Arabian Business.
Aviation industry analysts said IndiGo’s decision to go with HAE to boost its cargo business in the Middle East region is likely to be lucrative given the latter’s extensive knowledge of the Middle East market and its comprehensive network in the region.
Cargo business currently accounts for 4-5 percent of the Indian budget carrier’s overall revenue.
“We want to increase the share of the cargo business in our overall revenue significantly in the coming years,” Boulter said, without giving any specific target or timeline for the proposed growth plans.
Aviation industry experts said cargo is a highly profitable business for airlines in terms of revenue per ASMs (available seat miles).
Boulter said IndiGo’s focus is on achieving higher revenue per available seat per kilometres (ASKs) rather than achieving higher passenger load factor (PLF).
Though IndiGo tops the list among Indian carriers in terms of market share (47.8 percent in July ‘19), it’s third in terms of PLFs at 86.2 percent (July), below SpiceJet (92.4 percent) and Go Air (90.4 percent).
Manufactured goods comprise a major part of cargo from the Gulf region to India, while perishable items such as food products, fruits and marine products mainly account for majority of cargo from India to the Middle East.
“UAE, particularly Dubai, acts as a hub for many of the manufactured goods brought to India from not only the Middle East but even from other regions and hence offer a lot of potential for the growth of our cargo business from this sector,” Boulter said.
As part of IndiGo’s plans to grow its cargo business, the carrier is currently incresing its fleet with the Airbus 321.
“Airbus 321 has much more capacity to carry cargo, as also passengers, compared to Airbus 320,” Boulter said.
Airbus 321 Neo has a seat capacity of about 244 as against 180-186 seats of Airbus 320 Neo.
IndiGo’ current fleet comprises more Airbus 320s, besides Airbus 321 and ATR.
“We will be (approximately) adding one aircraft a week from now on. This will help us grow both our international operations as also the cargo business.”
IndiGo has also drawn up an aggressive plan to expand its operations to the Middle East, with a slew of new and additional flights to UAE and Saudi Arabia planned in the forthcoming winter schedule.
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