Representatives from Luxembourg-based Cargolux, and China-based Henan Civil Aviation Development & Investment Co (HNCA, an investment arm of the government of China’s Henan province which owns a 35% stake in Cargolux) met in Beijing today, and signed an “Airline Equity Joint Venture Contract” that will allow the two parties to resume preparations for the launch of their jv airline, which will be known as “Henan Cargo Airlines.”
Last month, when Cargolux announced it was entering into a BSA and capacity sharing agreement with Dubai-based Emirates, we questioned what this meant for its long-planned Chinese jv airline. It seems now that the jv airline will indeed move forward, if slowly, with first flights planned for late 2018.
HNCA, the Henan Airport Group, and the Xinggang Investment Group Company., Ltd, a triad of companies representing the Zhengzhou Airport Economic Zone, (where the airline will be based) will hold 75% of the shares in the airline, while Cargolux will own the remaining 25%. The value of Cargolux’s 25% stake has not been revealed, although in the past Cargolux was attempting to bend Chinese FDI regulations, and was vying for a 35% stake in the jv (then referred to as Cargolux China) worth US$75 million. Chinese regulators typically cap foreign ownership of companies at 25%, and it seems like Henan Cargo Airlines will be no exception.
The airline is now slated to take its first revenue flight during 4Q18 – several years later than originally planned. As of June 2016, Cargolux said the jv airline would focus on trans-Pacific and intra-Asia traffic with a fleet of 747-400Fs. At the time, the biggest delay seemed to be obtaining regulatory approval from the CAAC. But, given China’s State Council Premier, Li Keqiang and Luxembourg’s Prime Minister Xavier Bettel were both present during the signing ceremony, it appears the airline now has Beijing’s blessing.
For now, it seems Cargolux China will still come to fruition, just under a different name, as “Henan Cargo Airlines.”