Cargo-handling operations for new customer EVA Air have just started but are going well at Hong Kong International Airport’s Cathay Pacific Cargo Terminal, according to its chief executive officer.

“Performance has been up to our expectations and standards,” says CEO Kelvin Ko. “Even though the month of January saw less cargo, we expect volumes to resume and increase in February, particularly with the Lunar New Year period.”

Cathay Pacific Services Limited, the operator of the terminal, signed EVA Air as its newest airline client late last year, with the contract taking effect at the beginning of this year. The terminal already provides its services to AirAsia, Air Hong Kong, Cathay Pacific, Dragonair and Royal Brunei Airlines.

“We evaluate all of the Hong Kong facilities each year,” says Matthew Hsu, business management secretary at EVA Air’s cargo management department. “We decided to change our warehouse after reviewing the innovation of the Cathay Pacific Cargo Terminal because it fulfilled our future expectations.”

The process leading up to securing EVA as a customer wasn’t easy, according to Ko.

“When we started looking at potential new airlines, one of the things we were promoting a lot was our focus on customer service,” he says. “EVA’s philosophy aligns closely with ours and so we really wanted to work with them, but obviously we’re not the only terminal in Hong Kong and the others wanted a large airline like EVA too.”

Landing a major airline like EVA Air marks a significant milestone in the company’s relatively short history.

“Each customer is important to us,” says Ko. “But, apart from the home-based airlines, EVA ranks among the top both in terms of service and freight volume, so it was a helpful vote of confidence and beneficial in securing other potential clients in the future.”

Before it was ready for the transition, the terminal had to go through a six-month preparatory phase during which staff members were trained, specialized teams were set up, warehouse facilities and additional storage areas were established, computer systems were changed and trials were carried out.

“We don’t serve too many airlines, so the level of customisation can be higher,” says Ko. “When you have a large number of customers, tailor-made changes become more difficult.”

The terminal also had to set up an Express Handling Centre and introduce the Cross-Border Express, a truck service which it provides on behalf of EVA Air to transport shipments to and from nearby places in Mainland China such as Shenzhen.

“We’ve been very satisfied with CPSL’s tailor-made services up to now,” says Hsu. “We look forward to CPSL’s implementation of efficient cargo handling, which would enhance our customers’ satisfaction as well as competitive advantage so that we’re poised for further growth in the world.”

Hsu also noted that the risk of overcapacity and yield decline is still a major concern for EVA.

One major challenge facing the terminal, according to Ko, is the fierce competition for customers.

“The industry is very competitive because there is still room for expansion at the other terminals and they’re all fighting to attract airlines too,” he says. “We hope to win them over with our emphasis on service. Our facilities are new and processing time is between three and five hours, which is quite good compared to industry standards. Also, the fact that we don’t have too large a client portfolio means that we can offer a personalised service, even though service standards overall are already quite high in Hong Kong.”

As for whether any specific deals are on the horizon, Ko appears wary but optimistic.

“It’s definitely not going to be an easy task, but there’s actually still a lot of cargo coming through Hong Kong, so we’re always looking for potential new customers,” he says. “I won’t name names, but we are in active discussions with a few, so we’ll have to see.”

– Jeffrey Lee