Gov't panel OKs Japan Post's entry in international distribution services
A government panel on privatization of Japan Post approved Wednesday the postal entity’s plan to invest in an air cargo joint venture to be set up by All Nippon Airways Co., Nippon Express Co. and Mitsui O.S.K. Lines Ltd., panel members said.
This will pave the way for the joint venture, ANA & JP Express Co., to begin logistical operations in August between Japan and China after the Ministry of Internal Affairs and Communications will endorse the approval as early as later this month.
Japan Post, which is due to be privatized over a 10-year period starting in October 2007, is seeking to make international logistics services as one of its main revenue sources, considering its weak earning power in conventional postal services.
ANA & JP Express is to start flying two cargo planes between Japan and China in August, connecting such Japanese airports as Narita, Kansai and Chubu with Chinese airports in Shanghai, Tianjin and Dalian, according to the company’s business plans.
The joint venture is planning to add a connection between Chubu and Chicago airports in or after October. It is also considering launching flight routes to Beijing and Seoul in the future.
ANA & JP Express estimates its cargo traffic volume will be about 30,000 tons in fiscal 2006, 90,000 tons in fiscal 2007, 125,000 tons in fiscal 2008 and 200,000 tons in fiscal 2009.
The company hopes that it will move into the black in fiscal 2008, which runs through March 2009.
In submitting the approval to Internal Affairs and Communications Minister Heizo Takenaka, the committee came up with several conditions for the joint venture to carry out its businesses.
The conditions included the company’s obligations to inform the panel on its business conditions on a regular basis and not to unfairly damage businesses of its rival companies.
Earlier this year, Japan Post and TNT Post Group, a Dutch operator of express delivery and logistics services, had to delay their plan to set up a joint venture from the original target of April as negotiations over their ratio of investments were proceeding with difficulty.
