overview
CHINA CONSOLIDATION
China Cargo Airlineswill have a long-range fleetmade up predominantly of B777Fs plus some B747-400Fs,with a regional fleetmade up of A300-600Fs. Sources at the company are adamant that by that time the companywill be the largest Chinese air cargo player. The cargo business of Shanghai Airlines,meanwhile, is
split between Shanghai Airlines Cargo catering to the domesticmarket and Shanghai Airlines Cargo International. The latter currently owns threeMD-11Fs and wet-leases one B747 freighter. Luo Zhuping, secretary of the board of China Eastern
Airlines told Air Logistics China that the integration of the China Eastern and Shanghai Airlines cargo divisionswas an ongoing process.
SINOTRANS VENTURE Furthermore, in December the country’s number one logistics player, Sinotrans, announced itwas tying upwith China Eastern in an air freight venture,whereby Sinotrans would pump cargo China Eastern’sway, primarily for intra- China business. Sinotrans already has a joint venturewith Korean Air
Cargo called Grandstar Cargo International Airlines. Sinotrans officials say the two joint ventureswill remain separate and focus on different regions. In a classic display of Beijing’s insistence on bolstering the BigThree airlines, thisMarch state-run China Aerospace
acquired GreatWall’s two other shareholders are none other than Singapore Airlines (with 25 percent) and Singapore sovereign fund, Temasek Holdings (24 percent). Shanghai-headquartered GreatWall Airlines is the first
Sino-foreign joint venture cargo airline connecting China to themajor cargomarkets of theworldwith its B747-400F fleet. China Easternwill set about readying an initial public offering for GreatWall, likely to be in Shanghai, senior management told Air Logistics China. This coming together of three cargo entities under the
China Eastern umbrella has catapulted it fromthird to first in the Chinese air freight stakes in just threemonths. However, the newChina Eastern faces serious competition.
AIR LOGISTICSCHINA 23
Science andTechnology Corporation handed over its 51 percent stake in GreatWall Airlines for free. This sudden movewas highly significant on two fronts: first itmade China Eastern the number one Chinese cargo player, via its nowthree freight subsidiaries; secondly, it circumnavigated the tortured path that it had pursued in the past couple of years of getting Singapore Airlines onboard as a strategic investor. At the insistence of Air China, the Civil Aviation Administration of China (CAAC) repeatedly stood in theway of the deal. However, newly
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