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National carrier to begin all cargo operations from June

It is first time in the 75 years of Air India that one of its aircraft has been converted to begin cargo operations, reports L Mishra.

business Updated: Apr 24, 2007 20:26 IST

One of Air India's A-310 aircraft sent to Germany for conversion into all cargo configurations four months ago has been delivered in Dresden on Tuesday. The freighter is scheduled to arrive in Mumbai on Wednesday.

This is the first time in the 75 years history of Air India that any of its aircraft have been converted to begin cargo operations.

Global leaders in military transport and freighter aircraft, European Aeronautic Defence and Space Company (EADS) NV, Germany has converted this 16 year-old passenger aircraft, one of the youngest in the A-310 fleet. One more A-310 aircraft currently undergoing conversion at EADS is scheduled to arrive in the next few weeks.

The cost of conversation per aircraft is approximately $7 million and the payback period is three to four years, said airline officials.

Air India director (Finance) and spokesman S Venkat confirms the development.

Air India has decided to deploy this freighter in the Kerala-Gulf sector due to increasing demand from importers and exporters. From June onwards full-fledged cargo operations will begin. In three years the airline is planning to have a dedicated fleet of 10 to 12 cargo aircrafts, a separate profit centre of the yet to be merged entity.

Air India will be sending the rest six A-310 aircraft in its fleet for conversion into freighters in a phased manner. One of the major reasons behind this move to phase out older aircraft from passenger operations is due to frequent technical snags for which the airline has been receiving flanks from passengers. Incidentally Airbus has stopped the production of A-310s.

Once the newly ordered Boeing aircraft join into passenger operations, Air India will convert few of its Boeing 747-300 combi aircraft into freighters to satisfy the European market. These freighters will be deployed in the European sector.

Currently, Air India generates Rs 400 crore revenue from cargo operations, carried out by its passenger aircraft. "We will see an improvement of 10 to 12 per cent in revenue growth from these all cargo operation. Apart from converting our older aircraft into freighters, we will also hire cargo capacity to emerge as a major cargo carrier in the next three years," said a senior official.

Currently Air India's market share is 8 per cent of imported cargo while that of 11 per cent of exported cargo.