Cargo activities around Chongqing’s Jiangbei International Airport are set to go up another notch as the first phase of a new logistics park on its doorstep opens for business. Lufthansa Cargo sees enough growth in the area to add one more weekly freighter to the Chinese city.
On March 30, the Goodman Chongqing Airport Logistics Park officially opened its doors. Built by the Goodman Group, a global property development and management firm based in Australia, it is located adjacent to the airport and in close proximity to Chongqing’s city centre, with good connectivity to the Chongqing-Chengdu economic corridor, according to the developer.
It has attracted an international mix of clients, predominantly from the logistics side. Besides a Danish pump manufacturer, three logistics operators have set up shop there: Nikkon Logistics, an international Japanese logistics company; Best Logistics, one of China’s largest operators; and Yunda Express, a privately-owned Chinese express delivery firm.
“There is surging demand for and a lack of supply of quality transport and prime logistics space in Chongqing, propelled by the city’s robust economic growth. We look forward to further expansion in this region and to securing high quality opportunities for our customers and investors,” said Philip Pearce, Goodman’s managing director for greater China.
At this point, 110,000 square metres of the new logistics park has been developed, with another 80,000 square metres to follow. Ultimately, the logistics park will comprise eight warehouses with an estimated end value of US$130 million. Goodman has signalled that it intends to invest US$400 million in Western China in the coming two to three years.
Lufthansa Cargo also sees good growth potential in Chongqing. The German airline has added a third weekly freighter flight to the city. It is routed from Frankfurt over Siberia and Seoul to Chongqing, so the westbound capacity on the aircraft is shared between Seoul and the Chinese city, leaving about 42.5 tonnes for exports from Chongqing, according to a spokesperson for the carrier.
International airlines have been upbeat about the “Three Cs” in China’s interior (Chongqing, Chengdu and Zhengzhou, which share the letter C in their airport codes). However, loads out of Chengdu and Zhengzhou have fluctuated, as these production centres are dominated by a single large manufacturer each, so disruptions in their production tend to have a pronounced impact on load factors. Chongqing, on the other hand, has a more diverse shipper base, which makes it easier to balance loads, noted James Woodrow, director of cargo at Cathay Pacific.
“Relatively speaking, demand out of Chongqing is more stable than Zhengzhou and Chengdu. This is mainly because there is more than one active shipper with regular production in Chongqing,” confirmed Titus Diu, COO of Air China Cargo.
The Lufthansa Cargo spokesperson called Chongqing “the capital of China’s laptop production.” HP, Toshiba and Acer are among the companies that manufacture laptops there. In addition, the area has a large automotive sector.
As in Zhengzhou and Chengdu, carriers depend on exports, as inbound volumes are still relatively weak.
Cathay, which supplements belly capacity to the city with freighter service, has no immediate plans to ramp up its footprint in this market, but keeps an eye on developments there. “We have five freighters per week already out of Chongqing,” remarked Woodrow. “We do continually look at whether the market can support a sixth freighter. This is something that is always on the table.”
Air China Cargo, on the other hand, is not contemplating a boost in lift at this point. The carrier currently has two weekly freighter departures to Amsterdam and another to Frankfurt out of Chongqing. Diu has not seen a surge in demand there in the past 12 months. “We strongly believe our thrice weekly services out of Chongqing are adequate enough to serve the Europe lanes well,” he commented.
By Ian Putzger
Air Freight Correspondent | Toronto
