TNT to connect Europe with own freighter aircraft

TNT India Private Limited, a wholly-owned subsidiary of Netherlands based Euro 12.6 billion TNT NV, is planning to connect India with the European Union and expand domestically this year. The company is looking at either buying or leasing freighter aircraft to launch its international operations out of India.

Said Abhik Mitra, Managing Director, TNT India, "The opportunities are huge for us to connect India with the European Union. We have a strong network in Europe and we will leverage this strength to expand our service offering to Indian companies intending to transfer their freight."

He said the company, which recently acquired the Hyderabad-based Speedage Express Cargo Services, is also exploring opportunities to extend its domestic air express service to various cities in the country. The company is looking at forming alliances with existing airlines to carry cargo for it.

Currently, TNT is connecting 110 cities on its own and reaching other important centres through its agents and partners. The major verticals for TNT in India are banking and financial services, automobile and auto components, pharmaceuticals, ICT sectors and computing. The company with its newly-launched domestic air express business aims to service these sectors intensively.

"The acquisition of Speedage yielding results very rapidly and we have almost transformed their processes within TNT's processes. After the acquisition we are growing rapidly. Recently we have added several new clients including Pantaloon and ABB," Mitra added.

The company had earmarked an investment of Euro 100 million in early 2006. However, with its plans to launch express service to Europe, the investments may be doubled over the next few years. The remaining funds will be used to augment the express delivery infrastructure in the next two years in the country.

"We have now used a part of the funds allotted to us by the global headquarters of TNT for acquisition of Speedage. We have no constraints for investments. If it is required to invest more, we will do it."

"India is among the world's top four markets for TNT. We have now consolidated our position with the acquisition of Speedage. Henceforth, we will expand our airline connectivity. We are also working out the possibilities of forming alliances with existing airlines. However, the project would be finalised later this year," Mitra told Business Standard.

According to him, the Indian express market is estimated at Rs 4,000 crore and growing at 20 per cent annually. The company is expecting nearly 50 per cent growth in sales in the next couple of years. TNT now has 600 depots in 450 cities and 2,500 employees.