Sat, May 19, 2012 - Page 12 News List

Chennai stopover to boost CAL’s air cargo business

GROWING OPTIMISM:The new business from India, together with a fall in global crude oil prices, has led the carrier to shelve its plan to idle more cargo planes

By Amy Su  /  Staff Reporter

China Airlines Ltd (CAL, 中華航空), the nation’s largest air carrier, is now more optimistic about the air cargo sector than it was at the beginning of the year, partly because of the emergence of India’s air cargo market and the recent fall in global crude oil prices, a CAL official said.

On Wednesday, CAL launched a route from Taipei to Luxembourg using Boeing 747-400 freighters. The airline operates two flights a week along the route, with the outbound journey stopping over in Kuala Lumpur, Malaysia, and Chennai, India.

This has made CAL the world’s only carrier with a direct cargo flight between Chennai — the third-largest air cargo distribution center in India — and Luxembourg, the fifth-largest air cargo logistics center in Europe.

The route is also the Taiwanese carrier’s only cargo line covering India’s market.

CAL believes the route could raise the company’s cargo revenue on Asia-Europe routes by 10 percent a year.

“We see strong demand from Chennai,” CAL spokesman Hamilton Liu (劉國芊) told the Taipei Times by telephone.

Several major electronics brands or contract manufacturers — including Nokia Corp, Motorola Mobility Holdings Inc and Foxconn Technology Group (富士康科技集團) — have set up plants in Chennai, raising demand for air cargo services, CAL said.

Prior to starting its Chennai stopovers, CAL had operated a route with a stopover in Delhi, India, since June 2004.

However, it decided to close the route in March because the company thought Chennai had more business potential than Delhi.

Taiwan’s second-largest air carrier, EVA Airways Corp (EVA, 長榮航空) is also eyeing India’s growing market.

Earlier this year, EVA president Chang Kuo-wei (張國煒) said India would become an increasingly important market for the company in terms of both passenger and cargo traffic.

While EVA has no plan to launch new routes connecting India in the near future, the air carrier currently runs three routes stopping over in Delhi.

Liu said expanding the network would be an important strategy for boosting the company’s cargo business, because CAL operates a relatively large cargo fleet, with as many as 20 freighters.

In addition, the recent declines in global crude oil prices have made the carrier feel more optimistic about the air cargo business this year, leading the firm to change its plan of idling more cargo planes in the near-term, Liu added

In February, CAL said it might take a third cargo aircraft out of service in the middle of this year, after idling two other aircraft and placing them in protective storage since late last year.

CAL said the carrier may join SkyTeam Cargo, a global cargo alliance, in the third quarter.

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