Dubai is the worldwide headquarters for aviation cargo chartering for India’s $11 billion Mahindra Group.
Mahindra Logistics has partnered with numerous fleet operators to ride the greater volume of shipments from India to the UAE and beyond.
The focus will go beyond such movements. Dubai-to-anywhere-by-air coverage is the goal. “What we have launched out of Dubai is our global chartering business, which is only for cargo,” said Rampraveen Swaminathan, Managing Director and CEO – Mahindra Logistics Ltd.
“In the long run, we’ll have full freighters deployed to move material across the world, but essentially anchored in and out of Dubai.”
Mahindra Logistics is the second big Indian corporation to announce Dubai as its international center in recent weeks. Malabar Gold & Diamonds has moved to Dubai’s Gold Souk Ext., where it will run its international activities.
The Mahindra Group operates in automotive, freight, industrial, retail, and high-tech consultancy.
Air cargo chartering is competitive, with UAE and Gulf legacy carriers dictating movements. Mahindra Logistics can capitalize on post-Covid shipment patterns.
“By global, we mean it’s not restricted only on the Middle East or GCC,” said Saurav Chakraborty, Mahindra Logistics Ltd.’s Head of worldwide Cross Border Solutions. “We will target foreign-to-foreign movement from Shanghai to Istanbul. We’ll rule the world.”
Full aircraft lease
The firm leases the aircraft 24/7. No airline shares cargo space piecemeal.
Mahindra Logistics would schedule certain full-aircraft journeys with airline owners. This covers payloads of any size. Swaminathan added, “Or odd dimensions.”
Developing $30b market
We have a broader logistical partnership with pharma, engineering, and electronics companies. That’s a key customer relationship lever.
“The other part is our segment-specific solution finding capability. We feel we can enter the market for these two reasons.”
The air freight space is busy, so significant players may ride it. Swaminathan said the global air freight business is around $22 billion to $23 billion and would likely reach $30 billion in three years. “We think we can penetrate and create value in a niche.”
The customer, tonnage, and other considerations determine the aircraft.
“If it’s a B2B or B2C segment, the requirement might be for a full flight, say 50 tonnes of cargo, we would offer an A330 or B757,” added Chakraborty. “A Boeing 777 or 747 is better for 100- or 120-tonne requirements.
We specialize in ODC (Over Dimensional Cargo). We also offered a bigger A124 using our expertise.” (ODC stands for over-deck cargo in the freight sector.)
“Our India business is mostly freight forwarding, not aircraft chartering,” Swaminathan stated. When considering charter services, we must choose a site in a neutral global commerce hub.
Dubai is a strong regional and global trading hub because of its connectivity to MENA, Africa, and Atlantic routes.