United States-based courier giant Federal Express has set up its first joint venture in the mainland.
FedEx, which previously operated only through agents in China, formed the 50-50 joint venture with Tianjin-based Da Tian W. Air Service Corp, its agent for northern China, FedEx Asia-Pacific president David Cunningham said.
'We wouldn't make these kind of investments if we didn't see hard returns for our shareholders,' Mr Cunningham said. He declined to reveal the size of the investment.
FedEx, a unit of FDX Corp, has boosted its mainland services in the past month, adding one flight a week to Beijing and Shanghai, and launching five weekly flights to Shenzhen.
FedEx is the only US cargo airline operating flights in the mainland, but rival United Parcel Service recently applied to the US Department of Transportation for the right to operate flights into the country.
The joint venture, Federal Express-DTW Co, began operating from its Beijing headquarters on November 1. It planned to open branches in Shanghai, Guangzhou and Shenzhen by the end of next year, and in an additional 100 cities by 2005, Mr Cunningham said.
Working through a joint venture rather than an agent would allow FedEx to conduct sales, billing and customer services directly with clients, he said.