United Parcel's China Volume Doubles
United Parcel Service Inc.’s annual sales in China doubled to about $200 million in the year after the world’s largest package-delivery company began its own flights to Beijing and Shanghai.
The company started the flights to those cities in April 2001 and plans to increase the number of representative offices in China to at least 20 by the end of next year from five now, said company Chief Operating Officer Tom Weidemeyer in an interview.
“The China market is probably the biggest new opportunity to emerge in many years,” Weidemeyer said. “We have been very optimistic about the World Trade Organization and the inclusion of China.”
Since China’s entry to the World Trade Organization earlier this year, the Atlanta-based company has more flexibility to expand it presence in China. China was the main contributor to United Parcel’s 17 percent growth in Asian sales in the second quarter from the year-earlier period.
United Parcel conducts business in the world’s most populous nation through a 50-50 venture with Sinotrans Air Transportation Development Co., a unit of the Sinotrans Group.
Asked whether United Parcel would be interested in taking part in Sinotrans Group’s planned $300 million initial share sale in Hong Kong, slated for the end of this year or early next year, Stephen Monaghan, vice president of public affairs of Asia Pacific, said the company continues “to look for opportunities in Sinotrans.”
United Parcel opened offices in Shenzhen in southern China and Qingdao in the northeast last week, bringing the total to five. It will open four more offices by early 2003 and have more than 20 representative offices by the end of next year.
Hong Kong Air Accord
Separately, Weidemeyer said U.S. carriers are urging the Hong Kong government to accept an open skies agreement with the U.S. A new round of talks will be held in mid-October, he said.
“This would promote the development of Hong Kong as a hub for express cargo operations,” Weidemeyer said. “Even a modest liberalization of the Hong Kong agreement would result in faster global services for business all over the world.”
A liberalized air services agreement would allow United Parcel to connect Hong Kong to its intra-Asia hub in the Philippines and its European hub in Cologne, Weidemeyer said at a luncheon in Hong Kong yesterday.
