TNT looks at own air services for far east

TNT, the express courier and logistics company owned by Dutch postal group TPG, is considering the possibility of using its own freighter aircraft on some regional and transcontinental services following the Sars outbreak. Deputy country manager Ambrose Linn said the firm's ability to service its express customers had been hurt by airlines' decisions to cut flights as passenger numbers plummeted because of Sars.

Consequently, some consignments had to be barged to Macau airport or flown via Taipei to Singapore. The shortage of capacity meant TNT had to charter cargo aircraft to operate between Hong Kong and Singapore to ensure consignments reached Singapore and Malaysia."If we did not have the charters we would have been crippled," Linn said, adding that transit times increased substantially. He said the reduction in flights _ Cathay Pacific cut 45 per cent of its flight at the height of the Sars crisis, while other Asian airlines also made deep cuts _ was still affecting business.

"We don't expect airlines to normalise schedules for another two months," Linn said.

He added that the possible use of its own freighters was in the strategic planning stage and a final decision could be made by the end of the year.

Initial discussions had been held with AirMark, an Indonesian airline that is mainly owned by Malaysian interests, which he said had rights to operate from Hong Kong.

Linn said the freighter flights would go from Hong Kong to TNT's hub at Liege in Belgium and return to Hong Kong via Singapore.

TNT used dedicated Boeing 727 and British Aerospace 146 freighters belonging to Pacific Air Cargo from the old Kai Tak airport. But these services ended about six years ago when TNT started to rely exclusively on commercial airlines or special charters.

Linn said among its concerns about using its own freighters were worries about demand and whether the plan would hurt its relationships with airlines.

He added that both Singapore Airlines and China Airlines applied about a month ago to increase freighter flights to Hong Kong but had yet to receive a reply from the Civil Aviation Department. Linn was speaking during a briefing on TNT's plans for the China market following the ending of the firm's 15-year joint venture with Sinotrans, the mainland's largest transport company, at the end of May.

TNT has instead linked up with Mach++ Worldwide Express, a specialist Beijing-based courier company that is a joint venture between the mainland and Hong Kong's Concorde company. Mach++ Worldwide also has strong links with China Post. TNT's managing director for China, Hong Kong, Taiwan and Macau, Bryan Chan, said TNT was in talks with China Postal Airlines about starting express courier services in the mainland in the next few months. He said China Postal Airlines served 11 mainland cities through its Shanghai hub and a tie-up with the airline would help create a hub-and-spoke courier network in China.

Chan believed a tie-up would also benefit EMS, China Post's express mail service which has a joint venture with TNT, by reducing the number of consignments fed through Hong Kong. Currently, a portion of EMS documents for southern cities in China are brought to Hong Kong for sorting by TNT.

A link between TNT and China Postal Airlines would allow these to be sorted in Guangzhou, reducing costs and improving efficiency.

Chan said TNT would open 13 new branches in the mainland by year's end, taking the total number to 25. The new locations included Hefei in Anhui province, Kunming, Xian and Chengdu.