JD Logistics adds second major airline partner, who’s next?

Last year, Chinese consumers bought more fresh fruits, vegetables, seafood, meats, and other perishable products through online channels than any other country in the world — and demand shows no sign of letting up. In order to accommodate this demand, the logistics subsidiary of Beijing-based JD.com, JD Logistics, has been actively expanding its domestic last-mile cold chain delivery capabilities. This week, a new partnership between JD Logistics and Air China Cargo seeks to extend this cold chain network beyond China, expanding the air freight bridge that connects millions of Chinese consumers to the high-quality perishables JD sources from around the globe.

This is the second such partnership with a major airline, following a domestic airfreight partnership JD inked with China Eastern last June. Looking ahead, many wonder if such global partnerships will be sufficient for JD.com’s air cargo supply chain, or if like Amazon, the e-tailer will move into some form of dedicated freighter operations. Most recently at a logistics forum in Beijing last December, Bill Fu Bing, head of logistics planning and development at JD.com told SCMP, “I can only say aviation will be important [for logistics] in the future.” He added, “Do we need to buy our own planes or build our own airports? This is something we are looking at.”

Returning to the e-tailer’s current logistics activities, JD.com has always seen logistics as a key pillar supporting its e-commerce business, and as such, the company has invested heavily in building out its fulfillment and last-mile delivery networks. Perishables have been a major consideration as they are in extremely high demand, but must arrive at the customer’s doorstep unspoiled to warrant the premium paid.

An ongoing test of JD’s last-mile cold-chain delivery and tracking solutions has been an online-to-offline “O2O” partnership with the local subsidiary of US-based membership-only warehouse, Sam’s Club, to provide same-day delivery of fresh products in select Chinese cities. In practice, a JD Logistics courier retrieves an order from a Sam’s Club, and transports the goods to the customer in an FDA-approved cool storage box equipped with real-time tracking devices.

This, and other initiatives, have given JD Logistics the knowledge required to operate what it calls China’s largest cold chain logistics network. Air China Cargo will extend this network by giving JD Logistics access to its complete portfolio of cold chain solutions. This includes access to Air China Cargo’s global airfreight network and regional cool chain transit hubs.

Zhenhui Wang, CEO of JD Logistics, said, “One of our goals for 2018 is to partner with more global leaders in logistics to extend the strength and reach of our logistics network. This partnership with Air China Cargo is a great example of how we can achieve this.”

Those interested in learning more about how leading companies in the air freight logistics space are benefiting from the e-commerce revolution are invited to join us at this year’s Cargo Facts Asia Symposium, to be held 23-25 April, at the Mandarin Oriental Pudong in Shanghai. For more information, or to register, visit www.cargofactsasia.com