Indians must have thought once, in abroad domestic passenger air tickets are less costly, what would be the reason?
Well Indian aviation policy 2016 also recognized that domestic and international air freight or air cargo and express logistics would be helpful to reduce or subsidize the passenger air fare.
Following are the few facts of Huge Upcoming Air Cargo Scopes –
- Air cargo, particularly domestic has a high employment potential, especially for semi-skilled workers.
- Air cargo ecosystem, Express Delivery Services is becoming pivotal especially in the light of double digit growth in e-commerce.
- E-commerce companies are expected to invest close to $6-8 billion in logistics.
- The e-commerce sector has been witnessing consolidation, which in turn would open up opportunities for the express market.
- Around 10 per cent of the shipments carried by some of the express companies are B to C shipments. There are also companies who works only in carrying B to C shipments.
- Introduction of a product with cost and transit times between current air and surface products.
- Induction of multiple aircraft’s with 100 per cent capacity utilization, streamlining the last mile costs to B2C benchmark levels.
- The consolidation in the e-commerce sector and with internet penetration expected to nearly double in the next four years.
Innovations are very important in this sector, as the demand is always for more reach and faster shipping at lower costs. The companies will need to invest in automation, while utilizing existing resources well.
Some of the new initiatives should be taken by air express operators –
Currently, air cargo volumes in India are very low as compared to other leading countries due to high charges and high turnaround time.
- Parcel lockers,
- On-the-Move (OTMs)
- Handheld devices,
- Mobile point of sales (MPOS) solution,
- Cash on Delivery (COD),
- Reverse logistics with various value-adds such as ‘open’ and ‘cash return’,
- Preferred time of delivery.
- Provision of track and trace.
- Easy surface connectivity to the air-ports.
- World-class cargo transit hubs.
Presently, there is a very low level of air cargo penetration characterized by only a few airports equipped to handle large volumes of express delivery parcels. As the e-commerce gathers momentum and moves to the several less populated cities like tier 2 and tier 3, there will be increasing demand of expanding air cargo connectivity to smaller towns. The industry would invest in about $8 billion by 2025.