FedEx expands freight centre despite downturn

PUBLISHED : Wednesday, 11 January, 2012, 12:00am
UPDATED : Wednesday, 11 January, 2012, 12:00am


FedEx Express has expanded its airport facility in Hong Kong by more than a third to improve its parcel-handling efficiency, ignoring the downturn in the air cargo industry.

The company installed new equipment and storage space, which would allow it to handle 200 tonnes of cargo in just under 45 minutes, compared with two to three hours in the past, said Anthony Leung, managing director of FedEx Hong Kong and Macau, yesterday.

The ground handling facility of FedEx at the Asia Airfreight Terminal in Chek Lap Kok has been expanded 37 per cent to 4,695 square metres. Alongside the hardware upgrade, FedEx has also increased its Hong Kong staffing levels by 5 per cent.

The expansion in facilities comes as cargo volumes are dwindling. Hong Kong International Airport saw its cargo tonnage drop 4.6 per cent year on year in the first 11 months of last year.

The uncertainty in the global economy prompted Cathay Pacific Airways to defer the delivery of two Boeing 747-8 freighters to next year.

Leung said the express cargo business would be less adversely affected by the European debt crisis than general air cargo. This is because importers tend to place ad hoc orders in small quantities rather than in bulk when they need to test customer response on products before placing big orders for them. This trend had become more widespread of late, especially for electronic goods and garments, said Leung.

'I don't have the crystal ball to tell whether there will be an uptick in the cargo demand at some point in 2012. But if it happens, just as it did in 2009, we will be ready for it because of the ramp-up.'

The number of trucking docks have been doubled to 14 and those with direct ramp access also doubled, to four. An additional 748 square metres of caster decks have been added to facilitate faster movement of freight shipments. The company has not revealed how much it spent on the expansion.

Leung said it would soon make its regular adjustment to service charges, but the percentage of the rate increase had yet to be finalised.

FedEx replaced old aircraft with Boeing 777 freighters in 2010 to give Hong Kong shippers a faster, non-stop service that gave them later deadlines to get cargo to the airport.


The increased capacity of FedEx Express' ground handling facility

- Cargo tonnage fell 4.6 per cent in the first 11 months of 2011