Business

Emirates enters e-commerce market with new service launch

Emirates enters e-commerce market with new service launch

Dubai: Emirates SkyCargo, the freight division of Emirates Group, is planning to capitalise on growth in e-commerce.

The business on Tuesday launched a new service, called Emirates Delivers, that allows customers in Dubai to shop online from retailers across the United States and have their goods delivered via Emirates.

The service allows customers to register online through a website, where they will receive a local US mailing address, which allows people to purchase from sites that don’t offer international shipping. Customers can have their parcels stored at that address free of charge for up to 30 days, and may buy goods from multiple sellers that will all be stored at the same location. Emirates will then deliver the goods to the UAE through its flights, and has partnered with local companies to deliver parcels to consumers’ homes or offices. Emirates said it will be managing even the last leg of the delivery process, rather than have that managed by courier companies, and will have its own fleet of delivery vehicles.

For customers who opt for immediate delivery, Emirates says it can deliver parcels 3-5 days after a purchase is made online. The company said it has already tested the service with 4,000 customers to ensure a smooth roll-out.

Nabil Al Murr, divisional senior vice president for cargo at Emirates SkyCargo, said that with “huge growth” in the e-commerce sector, it was an area of interest for Emirates. He said that while the first phase of the service will only include shipments from the US to Dubai, Emirates Delivery will expand in key markets in Europe to provide delivery from there.

It will later expand to allow delivery between different countries, without Dubai necessarily being the point of origin or the destination. It will also eventually allow customers, including small and medium enterprises, to ship goods out of Dubai.

“[In cargo] in the last year or so, and this year, we’ve seen a global slowdown because of the trade war, issues such demonstrations in Hong Kong, Brexit in the UK, so all these geopolitical factors are definitely putting some pressure on global trade in terms of consumer confidence, and whether retailers want to stock commodity or not, so there’s some hesitation,” Al Murr said at a press conference in Dubai to announce the launch.

He pointed that certain segments within trade such as e-commerce are still seeing growth, with e-commerce now a $6 trillion industry.

Emirates’ comments on trade echo much of what other airlines have witnessed in the cargo market. According to the latest report from the International Air Transport Association (Iata), freight demand contracted by 3.9 per cent year-on-year in August 2019. This marked the tenth consecutive month of year-on-year decline in freight volumes, the longest period since the global financial crisis of 2008.

Iata said air cargo continues to face headwinds from the trade war between the US and China, as well as weakness in some key economic indicators, and rising political uncertainties.