Indian air cargo – flying high, scoring tonnage

According to the Trade and Transport Group’s recently published report ‘India Air Cargo Outlook 2023’, India generated 2.2 million tonnes of traffic, moving toward 2.5 million tonnes in 2023. Talking relatively, our air cargo traffic was 1/5th the size of China’s and about 1/10th the size of the U.S. air cargo market – with about 30% of the traffic generated domestically and the remaining internationally.

Cargo handled across Indian airports may touch 2.4-2.5 million tonnes in 2023 even as passenger/belly capacity comes back, said Frederic Horst, Managing Director, Trade and Transport Group. “With 5-6 Indian conglomerates investing abroad, the India link is always going to be strong. So, India is in a good position as far as trade is concerned.”

India’s air cargo market is dominated by international carriers like Aerologic (Lufthansa Cargo x DHL), Cathay and Turkish, while only a handful of domestic players like IndiGo, Air India and Pradhaan Air can be seen. The largest carrier in the Indian market is currently Aerologic (14%) followed by Qatar Airways (12%), Emirates (12%), Air India/Air India Express (8%) and Cathay Pacific (7%). However, despite fewer domestic carriers operating, in comparison to international traffic the domestic traffic has recovered to the pre-pandemic levels on the back of rapid rise in e-commerce, express and general freight traffic.

Air India and Air India Express account for 2/3rd of traffic carried by Indian carriers with IndiGo, Vistara and SpiceJet accounting for the balance, the report mentions. The report also mentions that there is an abundance of high frequency belly capacity, which is why freighter operations have struggled in the Indian market. The five existing freighter operators include Blue Dart Aviation, SpiceJet, IndiGo, Quikjet and Pradhaan Air Express.

With economic and trade growth expected to outperform in the near term, there are opportunities for growth – driven by imports and exports of intermediate and manufactured goods as well as e-commerce traffic. India could also benefit from a U.S. and European pivot away from China but that depends on how manufacturing capacity develops, particularly across consumer goods and high tech sectors.

Carriers’ traffic performance during 2022 was generally positive with the overall market growing by 8.4%. IndiGo grew by 14.5%, Blue Dart by 2.5%, Go Air, Air Asia and Vistara all grew by approximately 30%. On the other hand, SpiceJet traffic declined by almost 30% (primarily due to the removal of two out of five freighter aircraft out of its fleet), and Air India traffic declined by 2%.

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