DHL investments in India bode well for Blue Dart Aviation

DP-DHL’s Post eCommerce Parcel (PeP) division is investing US $75 million through its local subsidiary, Blue Dart Express, to meet the rapidly-growing demands for e-commerce logistics. These investments will increase automation and add much needed capacity to two of India’s busiest air hubs in Delhi and Mumbai, but what might this mean for the express company’s dedicated airline, Blue Dart Aviation Ltd.?

Following the upgrades, Blue Dart expects to reduce processing time for both inbound and outbound shipments, and increase handling capacity at both hubs to 500 tonnes per day. Anil Khanna, Managing Director, Blue Dart was especially enthusiastic about the implications for upgrades to the express company’s Mumbai hub. He told Cargo Facts that because of the Mumbai facility’s airside location “it will further accelerate the speed of domestic cross-border air shipments, streamlining customs processes and boosting on-time performance.”

As in many emerging markets, a growing middle class is driving rapid B2C e-commerce growth in India. Blue Dart has taken notice.  By the end of 2020, online B2C sales in India are expected to reach $32-43 billion, according to Charles Brewer, CEO, DHL eCommerce, more than triple the $10.3 billion in sales expected for 2016. Khanna said, that “Blue Dart set focus on the e-tailing industry in 2009-10” and has since “innovated for the industry in terms of deploying automation in the first mile/fulfillment/last mile & reverse logistics.”

In practice many of these innovations have come not only in the form of new delivery and fulfillment methods, but also in the form of increased payment options—many of which are not available in other markets. “Cash-on-Delivery (COD), Card (Debit/Credit) on Delivery, OTM Hand held devices (on the move), MPOS (Mobile Point of Sale), integration with Mobile Wallets, Parcel Lockers, Parcel Shops, Mobile Service Centers, Smart Truck, etc.,” to name a few. “Cash on Delivery (COD) and other payment options which have been major enablers for the e-tailing industry and coupled with increasing reach and subsequent demand from online shoppers from tier II, III and IV towns across India” added Khanna.

Shifting the focus now to Blue Dart’s air unit, Blue Dart Aviation, Ltd., although no immediate expansion plans have been outlined, the implication is that there will be growth in parallel with an expanding market and airfreight volumes. Currently Blue Dart Aviation serves seven major metro areas with its six-strong fleet of 757Fs:  Chennai, Bangalore, Mumbai, Delhi, Kolkata, Ahmedabad and Hyderabad. Most flights, according to Khanna “operate at night to allow for late cut-offs and early deliveries.” When asked about fleet additions, Khanna said, “all our forward looking decisions are taken with the customers (e-tailers) needs and wants in focus. We work closely with our e-tailing partners to co-create solutions that offer added value to their end customers.” With the gross merchandise value of India’s e-commerce market expected to triple over the next five years it seems likely Blue Dart’s customers will influence further expansion.

Interested in learning more about the impact of e-commerce on Asia’s air freight and express industry?  We invite you to join us at Cargo Facts Asia 2017, 25 -26 April at the Shanghai Grand Hyatt where a panel discussion will be dedicated to the subject. . To register, or for more information, go to CargoFactsAsia.com.