HK Express air-cargo bid flies into headwind

PUBLISHED : Friday, 03 July, 2009, 12:00am
UPDATED : Friday, 03 July, 2009, 12:00am

Plans by Hong Kong Express Airways to launch a cargo service in September are being blocked by one of its shareholders.

Andrew Tse (below), who owns 14.7 per cent of the small city airline that is controlled by the mainland's HNA Group, filed an objection with the Air Transport Licensing Authority after Hong Kong Express applied for a cargo licence.

'Until the airline hands in a comprehensive feasibility study on the cargo service, I will continue to put in an injunction whenever it reapplies for a licence,' said Mr Tse, who asked that any licence hearing involving the carrier be made public.

The airline withdrew the application but had since submitted another one, an Alta spokesman confirmed.

Mr Tse, a nephew of Stanley Ho Hung-sun, who owns about 40 per cent of Hong Kong Express, said management promised the board in a meeting in April it would present a detailed business plan for the cargo service.

The airline, which offers passenger services to mainland and Asian cities, planned to operate three weekly cargo flights from Hong Kong to Luxembourg via Abu Dhabi from September 18, president Yang Jianhong said. He said the air-cargo business was showing 'green shoots' and the firm wanted to get in early to seize on low aircraft leasing fees.

'We would like to reap the rewards of any upswing in the cargo market by entering the market at a low point,' Mr Yang said.

Hong Kong Express has been granted a three-month licence by the Civil Aviation Department to lease a Boeing 747-400 freighter from Taiwan's China Airlines. But before it becomes permanent, the airline has to be given a cargo licence by the Air Transport Licensing Authority.

Mr Yang said the airline had a strong case for launching a cargo business as he expected the sector to start recovering in the fourth quarter.