Air cargo volume revives despite capacity concerns

Indian airports saw a 29% increase in cargo shipments to 264,510 tonnes in August from a year earlier, according to the latest available data from the Airports Authority of India (AAI). While the figure is still lower than the 289,470 tonnes of cargo transported in August 2019, airline officials said it is only a few months before air cargo exceeds pre-pandemic levels.

“Cargo is expected to recover to pre-Covid levels in a month or two. Passenger traffic is also gaining momentum and should reach 2019 levels by the March quarter,” said a senior Gurgaon-based airline official on condition of anonymity.

Airlines realigned a part of their fleet during the pandemic to meet cargo demand amid a sharp drop in passenger traffic. Carriers like IndiGo and SpiceJet have dedicated freight carriers, while others usually carry cargo on the belly of their aircraft.

IndiGo is also in the process of inducting four Airbus A321ceo aircraft, each of which will be converted from a passenger jet to a full cargo configuration.

IndiGo’s cargo revenue grew 9.6% for the fiscal ended March 31, the company said during the quarterly earnings call with investors in July. Similarly, SpiceJet said its cargo revenue grew five times during the same period. Cargo yields have been very good for the past 12 months, IndiGo chief executive Ronojoy Dutta said in a conference call with analysts in July.

“The overall dynamic is that there were a lot of wide bodies (planes) flying there. Since the wide-body count has come down, so has the demand for cargo traffic, and that is what we are tapping into,” Dutta said.

“But, it is not as if there has been an overall improvement in cargo traffic,” Dutta said.

While the outlook for the cargo business remains positive, growth has slowed recently in some key demand drivers, and pandemic-related constraints have added to the pressure on available cargo capacity, the International Air Transport Association (IAF) (International Air Transport Association) said. Iata) said. A statement last week.

“One of the main challenges to advancing economic growth is a severe global supply chain congestion as a result of pandemic restrictions,” it added.

In India, the growth in cargo business will come as a relief to airlines that are restricted in selling more seats on scheduled passenger domestic flights. Airlines are currently allowed to operate only up to 85% of their pre-Covid capacity on local routes.

Meanwhile, global demand for air cargo grew 7.7% in August from a year earlier, Iata said.