Singapore-headquartered SATS Ltd (SATS), the world's largest provider of air cargo handling services, has signed a Memorandum of Understanding (MoU) with SF Group, a major express delivery and logistics service provider in China and globally, to expand their strategic collaboration and supply chain optimisation into a global footprint.

"SATS and SF Group will combine their respective areas of expertise and service offerings as well as those of their affiliate companies, including Worldwide Flight Services (WFS), a member of the SATS Group, and SF Airlines, the Chinese cargo airline owned by SF Group," the announcement said.

SATS and SF Group will initially look at expanding the successful collaboration of the existing hub operations in Singapore and e-commerce handling in Liege, Belgium, to other global hubs.

These include the hub operations in Kuala Lumpur, Malaysia and exploring Proof of Concepts (PoCs) for e-commerce handling in Beijing and at New York's JFK International Airport.

The partners said they would also identify and build other network solutions or specialised services from more than 200 locations where SATS is present with SF Group's extensive demand channels, which is currently the world's 4th largest integrated logistic provider and is based in China.

"We are honoured that SF Group has chosen to partner with SATS to identify new network expansion opportunities and service improvements globally," said Bob Chi, CEO of Gateway Services Asia-Pacific at SATS, adding that the two organisations can learn a lot from each other as they embrace the collaboration and go beyond the traditional customer-vendor relationship.

"This is a mutually beneficial partnership where both parties are leveraging on each other's strengths to improve the supply chain and create value for our respective stakeholders. We are confident of building on the successes that we have today to expand into a multi-station global network collaboration," Chi said.

Zhang Ji, vice president of SF Group, said as China's largest and the world's fourth-largest integrated logistics service provider, SF Group is actively promoting its overseas growth strategy.

"The collaboration with SATS Group, which is one of the world's largest aviation ground service providers, with the continuous growth of its worldwide network in the field of aviation logistics, will enhance the competitiveness of both parties and achieve a win-win situation," he said.

The announcement noted that growth opportunities for the SATS and SF Group collaboration will be enhanced by the continued expansion of the global e-commerce market, forecast to grow by 8.8% in 2024 to US$6.3 trillion and to US$7.9 trillion by 2027.

The partnership agreement between the market leaders was formally signed at SF Group's headquarters in Shenzhen by Ji of SF Group and Chi of SATS.

The announcement said Chi will also jointly lead the Steering Committee overseeing regional or country-level Working Groups conducting the Strategic Projects under this agreement.