New carrier touts low-cost model

  • July 1, 2013

If there is such a thing as a low-cost entry into the air cargo market, then that is the approach Europe’s newest cargo carrier, Aerospace One, appears to be adopting.

In fact, the growing airline proudly proclaims that it is the industry’s first truly Low Cost Cargo Carrier, hereafter known as the L3C model.

In a nutshell and, it insists, without compromise to operational safety and security, Aerospace One says its L3C model offers air cargo services at competitive rates, high frequencies and low cost in the logistics supply chain. Customers should note the L3C template incorporates no fuel, security and other surcharges.

It is on the back of its L3C mantra that Aerospace One has begun operations. And, as befitting its low-cost credentials, it is doing so with a single B747-200F. The aircraft, rumoured to be nearly 30 years old, has been acquired from Rayyan Air, a Pakistani registered carrier.

Less antiquated B747-400F capacity is on the way.

Aerospace One says it will adopt an L3C “mobile model of operational activities,” but principally intends to position itself in the European market as an ACMI and charter operator targeting the heavy lift business.

But founder Jaideep Mirchandani says the airline wants to spread its wings beyond Europe. The vision, he says, is to build cargo bridges between continents, which initially means between Asia and South America by way of Europe. The carrier’s maiden flight was a B747-200F charter from Sharjah, United Arab Emirates to Jakarta, Indonesia.

Aerospace One subscribes to a disparate mobile mode of operational activities and is in fact part of the more expansive Sky One aviation group, headed by Mirchandani.

In its own right, the carrier has acquired a Greek AOC with which to conduct its European activities, having registered as a Greek company. The chief executive of the new Greek airline is Aristeidis Pappas. Prior to his appointment, Pappas was senior flight operations inspector with the General Civil Aviation Authority of Dubai in the United Arab Emirates.

The carrier’s sales operation will be fronted exclusively by charter broker chartersphere from its London offices. chartersphere is an established charter broking operation started by managing director Paul Bennett. But it is also an affiliate of the Skyone group, with both Bennett and Mirchandani listed as co-owners.

Bennett confirms that Aerospace One will work both the ACMI and charter markets.

“By serving a combination of both, we will be able to draw on the strength of our fleet to complement each other and provide greater flexibility,” Bennett says. “But it is likely the B747-200F will focus on the charter side and offer back-up for the B747-400Fs when they arrive, which we envisage being put out on ACMI lease.”

Bennett defends the choice of the fuel-sapping B747-200F with which Aerospace One is starting up.

“The fuel component is, of course, the largest fixed-cost on any flight, but whilst the older -200F does have a higher fuel burn it is cheaper to operate than the -400F,“ he says. ”At the end of the day, we expect these factors to cancel each other out and anticipate that they will offer us the same value.”

And the anticipated arrival of the -400F equipment?

“We will be taking delivery of two leased -400F series aircraft, which will be available from August,” Bennett says. “They will also be flying under Greek registration.“

Aerospace One has been required to go to considerable length and expense to gain its European credentials, but it insists this was essential to the start-up.

“Being an EU operator is very important to us,” Bennett says. “It not only provides us with prestigious benefit of EU traffic rights, but it also allows us to respond even faster and more flexibly…As an EU-registered airline, it means we are also able to guarantee standards of maintenance and safety, which I believe offers vital peace of mind to businesses operating in the global marketplace.”

It was initially indicated that Aerospace One had nominated Châteauroux-Centre Airport in France as its operational European base.

Earlier this year, Sky One France was established when Châteauroux-based aircraft maintenance company Latecoere Aeroservices was taken out of receivership in a joint venture between Sky One and locally-based Valliere Aviation, headed by Gregoire Lebigot.

The bailout and subsequent acquisition by Sky One France co-founders Mirchandani and Lebigot purportedly cost the two new shareholders about US$5.2 million. But it means that Aerospace One has a readymade line maintenance base in the heart of Europe.

But Bennett discloses that the airline has yet to confirm if Châteauroux will also serve as the carrier’s European operation hub.

“At the moment, Châteauroux is one option under consideration, but it is among a number of locations we could use within Western Europe,” he says.

It is not clear yet how Aerospace One will prosper under its proclaimed L3C business model. But perhaps some clue can be gained from another of Mirchandani’s enterprises, Veteran Avia, an Armenian-registered cargo carrier based in Sharjah, which operates a fleet of 747-200s and Il-76s.

Primarily another ACMI operation, Veteran Avia has two B747-200Fs flying on behalf of Saudia Cargo. Little surprise that Veteran is also represented in the UK by chartersphere.

“Veteran has a long track record of operating B747Fs, and we will naturally draw on their experience and will also have access to their crews and aircraft,” Bennett says.

But Bennett appears confident of success for the fledgling new European carrier now under his wing.

“This will be a niche operator, entering a niche market,” he says. “We have the back-up and the aircraft to make a success of this exclusive affiliation.”

 

Mirchandani’s history

Mirchandani may have an extensive portfolio of aviation businesses, but it is his previous aviation endeavors that arouse interest.

Back in 2002, Mirchandani, as then owner of a Sam Avia, was indicted by an Indian court of operating a series of illegal flights between Delhi and Dubai. In connivance with Kazakhistan airline GST Aero, it was claimed that at least six illegal flights were operated using AN-12 freighters.

What intrigued the Indian authorities was the lengths to which the conspirators had gone to facilitate the flights. This included producing a forged letter on the letterhead of the Kazakhistan embassy, which was submitted to two Indian ministries in order to gain the necessary flight clearances.

Two years earlier, Sam Avia was investigated by India’s Directorate of Revenue Intelligence. The company was accused of allegedly being involved in a fraud whereby goods were flown out of India by Sam Avia, ostensibly to Russia, but in fact the flights only reached Dubai where the goods were offloaded and sold at a higher price.

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One thought on “New carrier touts low-cost model

  1. Hi. I haven’t been able to go know about the low-cost model. I’m glad to find it here. It was great to know about the B747-400F. I would like to read more about it. The Aerospace One can benefit a lot by working with both the ACMI and charter markets.Thanks a lot. 

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