IndiGo's cargo plans are independent of Interglobe-UPS JV, says airline

Interglobe Enterprise which holds 37.82% in IndiGo, is entering the business of logistics and cargo by forming a 50:50 joint venture with logistics giant UPS

The joint venture between Rahul Bhatia-owned Interglobe Enterprises and Atlanta-based logistics giant United Parcel Service (UPS) is completely independent of IndiGo, the airline clarified.

Business Standard on Wednesday reported that Interglobe Enterprise which holds 37.82 percent stake in IndiGo is foraying into the business of logistics and cargo by forming a 50:50 joint venture with UPS.

“The cargo arrangement between Interglobe Enterprise and UPS has nothing to do with us. That’s a standalone operation. They have their own agreements which have no impact on IndiGo,” CEO Ronojoy Dutta said in a post results call with analysts.

Dutta said that IndiGo’s cargo business will continue to cater to all customers and not be selective about UPS.

“The business of UPS is more likely to focus on small shipments and surface transport. We are into consolidated shipments. These are two ships passing in the night. We don’t signal each other. We have nothing to do with each other,” he said.

While UPS had a joint venture with an affiliate of Jet Airways, since the demise of Jet Airways, the venture has been all but dead. India has been on the cards of global logistics giants.

Sources said that the new venture with Interglobe will look to foray into all types of logistics services including warehouses, transportation and inventory management, and value-added services linked to the conveyance and shipment of all types of goods by air, land and sea.

German logistics major DHL acquired Blue Dart in 2004 and currently holds 74 percent stake in the company. UPS’ country rival FedEx last year invested $ 100 million in logistics start-up Delhivery which got listed in the stock market today.

IndiGo’s cargo business has grown by over 31 percent in terms of revenue in FY 22 as compared to the previous fiscal.

The airline, thanks to its 275 aircraft fleet size, is the largest carrier of cargo both in domestic and international sectors. In order to increase the scope of its cargo business, the airline is leasing four Airbus A321 freighter aircraft, - the first of which will arrive by middle of this year.