Shanghai-based cargo carrier YTO Cargo Airlines will start a freighter service between Changsha (CSX) and Kuala Lumpur (KUL) next month on behalf of Cainiao, the logistics arm of Chinese
e-commerce giant Alibaba.
Later this year, YTO Cargo Airlines will also seek to expand its network to Pakistan, while increasing frequencies to Saigon and Manila.
The airline currently operates a fleet of seven B737-300 freighters and five B757-200Fs on behalf of its parent, YTO Express, which is one of China’s largest express companies established in 2000 by Shanghai-based YTO Jialong Investment Development Ltd.
New hubs and more freighters
YTO Express last year signed an investment deal with the Jiaxing City local government in eastern China to convert a 96-hectare plot of land at Jiaxing Airport into an aviation logistics hub.
Once completed, the former military airport will become the company’s new US$1.8 billion aviation logistics hub, replacing Hangzhou Xiaoshan Airport which is currently the main base for the cargo
carrier.
To meet further expansion, the airline has placed orders for fifteen B737-800Fs and by 2020, the carrier said it expects to operate a freighter fleet of some fifty freighters.
YTO Express is a partner in the recently announced Cainiao Smart Logistics Network which also includes Chinese state investment firm, China National Aviation Corporation (CNAC).
In June last year, the three entities announced the launch of a new logistics hub at Hong Kong Int'l Airport. In a filing to the Shanghai Stock Exchange Cainiao said it would control 51%, CNAC
35%, and YTO Express 14% of the project which is valued at HK$12 billion Hong Kong dollars (US$1.53 billion).
Huge investments announced
The consortium said the facility will span 380,000 square metres and will be able to handle 1.7 million tonnes of cargo per annum at full capacity once it opens in 2023.
"The consortium participants will invest in establishing a joint venture company. The joint venture will then build and operate a high-end modern logistics centre through self-raised funds and in
accordance with the requirements of the Hong Kong Airport Authority's bidding," it said.
Cainiao currently has three fulfilment centres in Hong Kong, and according to a Reuters report, the company will open additional hubs in Dubai, Hangzhou, Kuala Lumpur, Liège, and
Moscow.
Altogether, Cainiao has committed to invest over RMB 100 billion (US$14.4 billion) to establish a smart logistics network that drives 24-hour delivery inside China and 72 hours to and from the
rest of the world.
Nol van Fenema