Flyington Freighters will operate only to China, Middle East, Africa and Europe, and has no plans for domestic operations owing to poor business prospects.
MUMBAI: The promoters of Deccan Chronicle newspaper will launch India's first international dedicated cargo airline, Flyington Freighters, in July this year with two leased Airbus A330-200F aircraft.
After signing the purchase agreement for six A330-200F aircraft with Airbus' CFO (customers) John Lehay on Wednesday, Deccan Chronicle Holdings Chairman T Venkattram Reddy said that USD one billion would be invested in the air cargo business.
"Initially, we will invest from the internal accruals. However, we may go to the market on a later date to raise resources," Reddy said.
Airbus would start delivering the aircraft, priced USD 175 million each, from the second half of 2008-09 and the entire fleet of six aircraft would be delivered by 2009-10.
"We have assessed the market and saw huge opportunity. Since there are no other players, there is no competition. Our intention to venture into this area is to exploit that huge untapped opportunity," Reddy said.
To be headquartered in Hyderabad, the airline would operate only internationally to China, Middle East, Africa and Europe, he said, adding that the company has no plans for domestic operations owing to poor business prospects.
"Flyington Freighters will be headquartered in Hyderabad because of the locational advantages the city provides. It is a perfect corridor between East and West. Besides the load factor in the Mumbai airport is high," Reddy said.
Flyington Freighters' Managing Director D Parasuraman said that India's market for freight was large and growing very rapidly.
"Globally, the market was growing at 6.2 per cent year-on-year," he said.
Flyington Freighters has already received all necessary approvals from the government, Parasuraman said.
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