As market introductions go, the emergence of Malaysia’s latest aspiring all-cargo airline has been somewhat unusual. In December, Swift Air Cargo revealed itself to the world, still bearing a distinctly non-logistical moniker, in response to notices from Malaysia Airport Holdings Berhad (MAHB) placed in the classified sections of two local newspapers to the effect that the authority would auction off or otherwise divest itself of three 747-200 freighters parked at Kuala Lumpur International Airport if their owners did not step forth to claim them and pay the parking fees.

To be precise, at this point there is no company by the name of Swift Air Cargo. The legal entity that claimed the aircraft is a firm registered in Malaysia under the name Splunk n’ Dash, but it is in the process of having its title changed to the more cargo-relevant name. It is led by chief executive officer Blue Peterson, a former airline pilot, and Sun Fai Li, a former executive with TradeWinds Airlines and Asian Rim Company, who has taken on the mantle of vice president of marketing and sales. Peterson’s career included a spell with Malaysia Airlines, as chief pilot at Indian carrier IndiGo and most recently as CEO of Bangkok-based cargo airline SukhoThai Airways. 

There has been some confusion around the ownership of the three aircraft in question, which have been sitting at the airport since 2010. MAHB’s records show Air Atlanta Icelandic as the owner, but the European ACMI provider returned them to Flugvik EHF, a holding company registered in Iceland, in 2010. Since then, the planes have not been registered.

According to the Swift management team and their lawyer, Flugvik subsequently sold two of them to Chinese cargo operator Shaanxi Sunshine Cargo and the third to a company in Turkey. They were later transferred in two separate transactions to an unnamed Hong Kong entity, which sold all three to the Malaysian start-up on June 8, 2015.

Swift reportedly paid US$30 million for the planes.

Swift’s lawyer expressed surprise about the notice placed in local papers by MAHB, claiming that the company had been in communication with the airport authority since last June, 10 days after the acquisition of the aircraft.

As far as MAHB is concerned, the ownership question has not been fully settled yet. Swift reported that in several meetings it produced documentation about the acquisition, such as a bill of sales, letters and a statutory declaration from the previous owner, but the authority expressed itself not able to verify the ownership to its satisfaction and requested additional documents.

In an interview with the BBC, Peterson stated that he is barred from getting access to the aircraft until he can meet MAHB’s request to submit his registration papers, but he cannot get the planes registered before maintenance checks, which cannot be done without access.

It remains to be seen how this question will be resolved. Swift stated that MAHB had requested the negotiations to be handled privately.

Assuming the company can get the freighters ready for take-off, management will face a host of questions about the commercial side of the enterprise. The description on its website characterizes the outfit as “a logistics airline, but with a unique twist implying Swift is without a competitor in the market.”

The opening move will be the launch of flights to Africa and South America, utilizing two 747 freighters. Through organic growth, management intends to “open new markets and develop a strong niche for its services."

There is indeed no competitor flying freighters from Southeast Asia to South America; in light of the stage length and yields, none has seen any point in opening such a route. The only carrier that operated freighters between the two areas (moving via South Africa) was Malaysia Airlines in the 1990s, but that service did not last. Yields have hardly improved since then to suggest that such a routing would be profitable.

Swift’s tag line is “the easiest way to fly a parcel.” E-commerce is certainly fuelling parcel traffic and causing demand for freighter lift, but for regional operations. Nobody has identified Asia-Africa-South America as the up-and-coming stage for a tidal wave of parcel shipments.

By Ian Putzger

Air Freight Correspondent | Toronto