A Chinese ‘takeaway’ – US-China freighter rights
The US-China freighter rights allocation just announced by the US Department of Transportation unfairly favours express operators, Northwest Airlines claimed last week.
NWA Cargo, which currently flies three freighters a week into Shanghai, told IFWit was disappointed its allocation ignored the greater needs of the heavy cargo market.
The DoT proposed allocating FedEx and UPS six weekly freighter flights each and a further six from March 2005.
These would be in addition to the 11 and six respectively the two currently operate. NWACargo was offered three this year and three next.
Polar Air Cargo, a new entrant on the lane, was provisionally awarded six weekly flights immediately, with a further three from March.
“NWA Cargo will continue to have substantially fewer frequencies than FedEx and UPS, despite the fact that the predominant demand in the US China market is heavy freight, ” the company said.
It declined to speculate on why the US government had favoured express operators, although FedEx and UPS are known to have a strong lobbying influence in Washington.
The carrier was also disappointed Polar would enter the market at the same frequency as NWA, “which has invested in China for many years”.
In its announcement, the DoT said NWACargo had access to belly capacity and “conversion of combination frequencies”.
NWAwas awarded seven weekly USChina passenger frequencies earlier this summer and can use its B747 “combi” aircraft on these.
But NWAsaid: “Belly space does not offer any meaningful incremental lift, certainly not for large and heavy freight where the predominant demand exists.
“In addition, NWAcannot convert passenger frequencies to all-cargo.” Aspokesman said NWAwas now evaluating its scheduling to determine how to most effectively use these additional frequencies and would be filing an application for more in 2006.
Polar said it was satisfied with the outcome and would not be drawn into a debate on the relative needs of heavy freight and express.
The carrier is planning to link New York, Chicago, Los Angeles and Miami with Shanghai, connecting through its north Asian hub in Seoul with multiple points in Asia, Europe and South America.
FedEx argued that demand for express air services, which it said increased 50% last year out of China, was stronger than for general freight.
“Coupled with their more valuable nature, the best use for limited US aviation rights is in the express sector, ” it said.
FedEx’s proposal was strengthened by support from the powerful US National Association of Manufacturers (NAM).
It claimed FedEx’s proposal would best promote US exports to China, especially by small and medium-sized companies, and would bring stronger US economic and job growth.
While US express operators such as FedEx provided value-added services themselves, generally performed by US staff, if general freight carriers offered these services at all, they were often performed by “foreign freight forwarders”, added NAM.
Charles Kaufmann, Asia Pacific air freight VPfor DHLDanzas Air & Ocean, said there was a big demand for both general freight and express China-US capacity.
He had been able to access sufficient general freight capacity, “but with Polar coming in and with the additional frequencies for the Chinese carriers and Northwest, the situation will get much better”, he said.
Posted: 13/09/2004
