New air cargo carrier targets China’s express and e-commerce business

A new cargo airline set up by Okay Airlines (OKAIR), Air Transport Services Group (ATSG), Vipshop and other investors plans to cater to China’s express and e-commerce business. According to a statement issued yesterday (24 September) by ATSG, the venture will “serve multiple destinations within the Peoples Republic of China (including Hong Kong, Macau and Taiwan) and surrounding countries”.

The JV company will be named United Star Express Airlines Co. Ltd and registered in Tianjin’s free trade zone. The investors hope to start flight operations in mid-2016.

Okay Airlines will provide the largest share of the registered capital of United Star Express. Okay Airlines Chairman Wang Shusheng will be the JV company’s chairman. The Vice Chairman will be Richard Corrado, Chief Commercial Officer of Air Transport Services Group and President of its aircraft leasing subsidiary, Cargo Aircraft Management, Inc.

The ATSG statement added: “The new airline will principally serve rapidly growing express air cargo demand driven by e-commerce growth in China and surrounding countries. From 2010 through 2014, the express market has been growing at an average of 30% per year.

“Express air services in China now rely mostly on excess capacity in the belly of passenger aircraft. Fewer than 120 all-cargo freighters operate within China, and only a small portion of those serve express markets.

“The growth rate of China’s e-commerce markets exceeds that of the air express market. Therefore, United Star Express will provide third-party express and charter aircraft services that cover the country and surrounding Asia regions to domestic and international express companies.

“Gradually, the company will also add medium- and long-distance cross-border express and cargo charter services that cover Europe and the America regions.

“United Star Express will be a new company that possesses its own airline operating certificate and will operate independently in accordance with international standards, with its own independent airline insignia, fleet, routes and organization.

“Within the first year of its flight operations, United Star Express expects to have six small and midsize freighter aircraft, including Boeing 737, Boeing 757 and Boeing 767 aircraft, to provide safe, high quality, reliable domestic and international air cargo services.”