Transcript Tracks & Traces of the Vibrant Dynamics in India

Emerging Air Cargo
Scenario in India
January 2008
Emerging Air Cargo Scenario in India
Tracks & Traces of the Vibrant
Dynamics in India
Traits & Trends of the Air Cargo
Scenario
Risk Factors and Road Blocks
Now it’s Time to Move
Mini commercial on Jet Airways and
its expansion plans
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Tracks & Traces of the Vibrant Dynamics in India
Population and Demographics
• Population growth is slowing
% average annual growth
1901-1950
1.0
1951-1980
2.2
1981-1990
2.1
1991-2000
1.8
2001-2010
1.5
Source: 1900-1990: Angus Maddison (1995), Monitoring the World Economy,
1990-2000:Census of India (2001)
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Tracks & Traces of the Vibrant Dynamics in India
Population and Demographics
• Literacy is rising
%
1950
17
1990
52
2000
65
2010 (proj)
80
Source: Censes of India (2001)
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Tracks & Traces of the Vibrant Dynamics in India
GDP
• Rising GDP growth
% average annual GDP growth
1900-1950
1.0
1950-1980
3.5
1980-2002
6.0
2002-2006
8.0
Source: 1900-1990: Angus Maddison (1995), Monitoring the World Economy,
1990-2000:Census of India (2001), 2000-2005 Finance Ministry
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Tracks & Traces of the Vibrant Dynamics in India
GDP
Composition of Indian GDP
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
Agriculture
Industry
Service
0.00%
93
Source: CII
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94
95
96
97
98
99
00
01
02
03
04
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Traits and Trends of the Air Cargo Scenario
India’s Air Import & Export
2006-2007 (Tones)
592,172 tones,
(55%)
480,283 tones,
(45%)
Import
Export
Source: CII
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Traits and Trends of the Air Cargo Scenario
India’s Air Import & Export
2006-07
Canada
Gulf Africa
Far
East
Others*
Gulf
USA
PERISHABLE
MARKET
Far East
Others*
UK
8
UK
Europe
Canada/USA
Europe
Traits and Trends of the Air Cargo Scenario
Perishable Market Profile
Gateway Distribution Apr’06 - Mar’07 (Tons)
HYD, 2% CCU, 1%
COK, 6% BLR, 2%
MAA, 7%
DEL, 14%
TRV, 19%
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BOM, 49%
Traits and Trends of the Air Cargo Scenario
Perishable Market Profile
Destination/Region Apr’06 - Mar’07 (Tons)
OTHERS, 3%
EUROPE, 5%
CANADA, 3%
USA, 0%
FAR EAST, 11%
UK, 12%
GULF, 66%
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Traits and Trends of the Air Cargo Scenario
Perishable Market Profile
Gateway Distribution Apr’06 - Mar’07 (Tons)
HYD, 2% CCU, 1%
COK, 6% BLR, 2%
MAA, 7%
DEL, 14%
TRV, 19%
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BOM, 49%
Risk Factors & Road Blocks
Vibrant Private Space in India
• ＞100 Companies have market cap US$1 billion
• ＞1000 Companies have received foreign
institutional investment
• ＞125 Fortune 500 Companies have R&D bases in
India
• ＞390 Fortune 500 Companies have outsourced
software development to India
• ＜2% bad loan in Indian banks (vs. 20% in China)
• ＞80% credit goes to private sector (vs. 10% in
China)
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Risk Factors & Road Blocks
Imperfect Public Space in India
•＋
•＋
•－
•－
•－
•－
Dynamic democracy with honest elections
Free, lively media and press
Poor governance
High populist subsidies → High fiscal deficit
Lack of money → Creaky infrastructure
Inefficient government companies
Source: RB Roy Choudhury Memorial lecture
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Risk Factors & Road Blocks
Key principles for managing risk in emerging
markets
• Hedge risks that are not specific to the organization
• Beware the effect of decision-making
• Allow two-way communication with emerging
market operations and be prepared to hear the
truth
• Link risk management with performance
assessment
• Structure risk approach to reflect the business
model
• In general, manage risk at their source
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Risk Factors & Road Blocks
However, the majority of risks fall into the “ it
depends” category, for example:
• Pricing
• Fraud and corruption
• Market
• Currency
• Supply chain
• Compliance
• Tax
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Risk Factors & Road Blocks
Geography & Main Logistics Flows
• All modes of transport suffer infrastructure
deficiencies
• Geographic, cultural, political and economic barriers
for infrastructure improvements
Supply of Warehouse Capacity
• There is no present supply of warehouse in any of
the metropolitan areas
• Only some emerging manufacturing and logistics
clusters that are being developed by third party
logistics services operations, etc…
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Now It’s Time to Move
• Time is now for India Cargo to improve airports,
roads and in short infrastructure at the major
meteors in the country
• Airlines, shippers, agents and local authorities
need to work side by side and single voice
• Customers service still need to be improved in
term of service after sales for which
infrastructure is not needed and we all need to
do our part
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Infrastructure and facilities requirement.
• Space .
BOM,DEL,MAA,BLR,HYD,CCU.
• Time schedule.
i. Truck turnaround.
ii. Documentation & inspection.
iii. Screening facilities.
iv . Build and break.
v. Acceptance and Delivery.
Equipment & IT.
i. Warehouse and ramp handling.
ii. Interface with carriers and forwarders systems.
iii. Real time status update.
• Support areas.
i. Facilities to handle multi modal freight .
ii. Improved and increased road network.
iii. Effective Road Feeder Service to and from inland points.
iv. Attitude of authorities.
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Progress on infrastructure .
• Up gradation of Mumbai and New Delhi.
• Green field airports at Bangalore and Hyderabad.
• Development of a cargo “HUB” at Nagpur.
• All projects - Joint Ventures with AAI & a consortium of
Indian and International companies ( GVK/GMR/FRAPORT/
Zurich Airport Authority etc.)
• Presence of International Ground Handling Agents – SATS/
Menzies.
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Areas of concern.
• Time frame.
• Involvement of users – forwarders and carriers in the planned
scale of operations.
• Increasing costs.
• Service level guarantee.
• Accessibility to the airports .
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Future Strategic Objectives
• Maintain leadership position in domestic market
– Consistently to enhance product and service delivery
– Reduce costs by further streamlining operations and emphasis on
technological innovations
– On-line sales to form 25% of total sales in the next 18 months
– Improved connectivity of existing points and higher frequencies
– Expand core business traveler/customer base
• Build leadership position in International markets
– ‘Raise the bar’ with our product and service
– Develop international network as the ‘second pillar’ of our
operations
– Carry forward domestic structure, reliability and efficiency levels
to international operations
– Comprehensive route specific bilateral partnerships
– Seamless “feed/de-feed” between domestic and international
networks
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No. of aircraft
Fleet Plan
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International Fleet Plan
• 10 B777-300ER between Apr 07 and Feb 08
– To be deployed on high-dense long haul routes – i.e. USA,
and UK
– 3 Class product with 312 seats (8/30/274)
• 9 additional A330-200 between Jan 07 and Sep 08
– To be deployed mainly on medium-long haul routes –
mainly Canada, South East Asia, Africa and Gulf routes
– 2 Class product with 220 seats (30/190)
• 2 additional B737-800s by Oct 07
– To be deployed on regional international routes to
neighbouring countries and thin SE Asia and Gulf routes.
– 2 Class product with 150 seats (24/126)
• 10 B787 Dreamliner aircraft, deliveries by 2011
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9W Network Opportunities –
Medium Term Target Market : Jet Airways
• Halfway between Europe and Australasia
• Halfway between Africa and Asia
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• Ideal Cross road between Major Markets
• Supported by Huge Home Market
USA / Canada / UK Network (by 2008)
Widebody Network
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Asia/Africa Network (by 2008)
Widebody Network
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Future International Route Network (by 2008)
Route
Freq / wk
A/C Type
BOM-LHR
14
B777
DEL-LHR
7
BOM-BRU-EWR
Freq / wk
A/C Type
ATQ-LHR
6
A330
B777
BLR-BRU-YYZ
7
A330
7
B777
BOM-HKG
7
A330
BOM-PVG-SFO
7
B777
DEL-HKG
7
A330
DEL-BRU-JFK
7
B777
BOM-NBO
7
A330
BOM-JNB
7
A330
BOM-DXB
14
A330
DEL-DXB
7
A330
COK-DXB
7
A330
TRV-DXB
7
A330
HYD-DXB
7
A330
MAA-DXB
7
A330
BOM-AUH
7
A330
BOM-SIN
7
A330
MAA-SIN
7
A330
MAA-KUL
7
A330
DEL-BKK
7
A330
BOM-BKK
7
A330
Additionally, regional
international flights will also be
operated with B737 aircraft
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Route
Thank You