Cathay Pacific

Jade Cargo hub plan eyes slice of HK freight market

PUBLISHED : Wednesday, 16 August, 2006, 12:00am
UPDATED : Wednesday, 16 August, 2006, 12:00am

Jade Cargo International, a Shenzhen-based airline, expects to serve as many as 10 destinations from its South China hub by early 2008 as the joint-venture carrier looks to transport cargo traditionally destined for Hong Kong.

Management of the all-cargo carrier, which made its first commercial flight on August 4 to Amsterdam, is committed to expanding its network to Japan and South Korea before branching out to the United States and elsewhere in Europe next year.

'We have to grow our network to expand our footprint in Asia, Europe and America. We're also open to developing an intra-China express product leveraging on our majority partner's rich and dense domestic network,' said general manager Rudolph Tewes yesterday. 'If there's demand, we'll serve it.'

Jade Cargo is 51 per cent held by Shenzhen Airlines, which says it serves 80 destinations within China. It was set up two years ago with Lufthansa Cargo, the world's eighth-largest scheduled freight carrier, and German investment bank DEG with a start-up capital of US$30 million.

The emergence of a well-funded cargo start-up such as Jade will be watched closely in Hong Kong, where incumbent Cathay Pacific Airways has aggressive freight expansion plans of its own, including construction of a dedicated cargo terminal ultimately capable of handling five million tonnes a year.

It is estimated that more than 70 per cent of 3.4 million tonnes of cargo handled at Chek Lap Kok last year either originated in or was destined for China, and Jade management believes the company is well-placed to intercept part of the flow.

Jade will take delivery of its second of six Boeing 747-400 'extra-range freighters' in November, when it plans to expand its network to either the northern Italian city of Brecia or Barcelona in Spain and Nagoya or Osaka in Japan.

The six aircraft would be fully delivered by January 2008, by which time the airline would be serving three commercial centres in Europe, two in the US, one each in Japan and Korea and 'one or two in India', Mr Tewes said. The carrier began flights to Seoul last week.

Mr Tewes said Jade would not shy away from competition for cargo in South China, a key manufacturing and exporting centre for the mainland where 20 per cent of the world's mobile phones are built.

'We don't need or want to be alone. We like competition,' Mr Tewes said.

The airline will be based at the International Cargo Centre Shenzhen, Baoan's international cargo terminal, in which Lufthansa is also a 25 per cent minority partner.

The airline's fledgling network may be boosted this year when Lufthansa transfers its four-times weekly Guangzhou-Frankfurt service - which it flies with 80-tonne capacity MD-11Fs - from Baiyun airport, insiders say.

The transfer is said to be under consideration for approval by Air China, a partner on the Guangzhou service.

Spreading wings

Shenzhen carrier to first expand network to Japan and Korea

Jade seeks share of 3.4 million tonnes cargo flow to Hong Kong

Carrier acquires six Boeing 747-400 extra-range freighters