Courier companies today threatened to raise rates by 30-35 per cent following a 60 per cent increase in baggage rates for on-board couriers by three domestic airlines.
The Express Industry Council of India, an apex organisation of express and courier companies, said the domestic airlines were trying to make up for the losses due to advanced purchase excursion (APEX) fares by hiking courier baggage rates.
Tushar Jani, chairman of the council said, "We have written to the civil aviation ministry, but are yet to get a response. If we do not get a response in the next 10-15 days, then we may be forced to pass on the hike to the customers."
Major domestic airlines like Indian Airlines, Jet Airways and Air Sahara have increased the courier baggage rates by around 60 per cent from June 16.
This is the sharpest increase effected by the airlines to date. The hike is in addition to the 7 per cent increase in January this year following the Gulf war which has resulted in a total increase of 67 per cent in last six months.
The members of the council represent 80-85 per cent of the total express courier business in the country and around 95 per cent of the overseas business.
The Rs 3,500 crore courier industry is currently growing at the rate of 15-20 per cent annually, which has helped the companies to absorb any hike in baggage rates by airlines up to now.
According to estimates by the council, the express and courier companies accounted for around Rs 160 crore of the airlines' revenue in 2002-03.
The yields of the industry, which acts as a catalyst to trade and commerce, have gone down 30 per cent, while the costs have increased 30 per cent.
Of the total revenue of Rs 3,500 crore generated by the courier industry, Rs 1,000 crore comes from the organised players and the remaining come from the unorganised, semi-organised and EMS speedpost sectors.
