FedEx may relocate asia pacific hub to China
Federal Express Corp, the world’s largest express transportation, is seriously considering plans to relocate its Asia Pacific hub from Subic Freeport to China when its contract with the Subic Bay Metropolitan Authority expires in 2008.
Angelito Alvarez, president and chief executive officer of Airfreight 2100 Inc, a license of FedEx, told reporters that David L. Cunningham Jr., FedEx President for Asia Pacific Division, met with President Gloria Macapagal-Arroyo last Thursday to personally inform her of its letter of intent (LOI) on the possibility of the transfer to China.
According to Alvarez, Cunningham personally informed the President of the LOI with China so as not to surprise her when news of it comes out.
The main reason for the future transfer of FedEx is the limitations of the Subic area as it is surrounded by mountains.
Even if the runway is extended, its kind of wide-bodied aircraft (A310s and MD11s) used do not fit for the mountainous terrain.
While the Philippine location in the middle of the Asia-Pacific region is ideal as a transport hub for the region, Subic is not an ideal choice.
Subic is described as a jungle and ocean and access by airplane is difficult.
FedEx operates 11 flights daily in the Subic hub from only five flights when its operation opened in 1995.
FedEx, however, has somehow raised the hope as the company is also looking at another option by relocating to Clark which is ideal for this kind of operations compared to Subic, which is a former American naval base.
At present, Clark is serving as an intra-Asian hub for the rival company United Parcel Services.
FedEx Asia Pacific hub in Subic is the central nerve center of the FedEx AsiaOne Service. It connects 19 key Asian cities.
But the possibility of FedEx’s going to China was bolstered by the launch recently of FedEx first direct flight from Shenzhen in South China’s Guangdong Province to its hub in Anchorage, Alaska, providing customers across south China with next-day delivery to North America.
Guangdong province is China’s top performer and has generated $124.6 billion foreign trade in the first six months this year alone, a 27.3 percent year-over-year increase, making it one of the strongest export markets in the world.
Globally, FedEx is the leader and is number one in the Philippines for volume and revenue. It also dominates in the Asia Pacific region for volume and revenue.
It offers delivery of packages, documents, and freight to 211 countries worldwide.
Aside from its 11 flights daily in and out of Subic, it also has one flight from the Ninoy Aquino International Airport and one from Cebu daily.
