SpiceJet's air cargo unit SpiceXpress looks to increase capacity, reach

By Prince Mathews Thomas

Prince Mathews Thomas Moneycontrol News

SpiceXpress, the air freight unit of SpiceJet, has charted an ambitious expansion plan that includes increasing its capacity, and taking its services to more destinations within India and overseas.

The freight carrier was launched in September, and started off with operations on the Delhi-Bengaluru-Delhi route.

SpiceXpress plans to increase its monthly freight carrying capacity from 15,000 tonne per month to 27,000 tonne, by the end of 2018. It also plans to further increase its capacity to 90,000 tonne by the end of 2022.

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In terms of destinations, the company is looking to take its services to nearly 10 more locations in India and overseas. These include Mumbai, Kolkata and Guwahati in India, and Dubai, Kabul, Dhaka and Singapore.

The company aims to eventually service up to 150 destinations in India, Asia and Europe by 2022.

SpiceXpress, which had started its service with a Boeing 737-700, plans to add four more freighter aircraft by March 2019.

Besides these aircraft, it also offers cargo capacity on SpiceJet's passenger aircraft fleet. The fleet includes 36 Boeings and 22 Q400s Bombardiers operating across 47 domestic and 7 international locations.

SpiceJet's focus on its new services comes at a time when revenue from cargo is increasing faster than that from tickets for most airlines.

SpiceJet's revenues from ancillary business, under which the cargo vertical is grouped, grew by 28 percent last fiscal, while revenues were up 25 percent.

The industry expects revenue from cargo to keep getting better. Research agency ICRA has estimated that air cargo volumes may grow by 60 percent over the next five years.