The Plum Blossom Soars: How Taiwan’s largest cargo carrier makes freighters work

New partnerships

Though crucial to carrier success, in today’s market, reliance solely on forwarding partners is insufficient. For this reason, China Airlines has taken advantage of the burgeoning e-commerce market by strengthening relationships with postal agencies and integrators around the world. Improving cross-strait collaboration on aviation between China and Taiwan has thus also been a boon for CI.

In July 2006, CI operated the first “direct” freighter service between TPE and Shanghai Pudong (PVG), via Hong Kong. In recent years, CI has been granted direct access to six cities in China, and currently operates scheduled freighter flights to PVG, Chongqing, Guangzhou, Shenzhen and Xiamen.

CI has also explored the freight-to-port business, since the Taiwan Customs Administration began permitting postal bags as trans-shipment cargo in March 2015. Liu recalls recent deals with China Post and its brokers, Vietnam Post, Malaysia Post, UPS, FedEx, DHL and SF Express, “which further enhance our revenues and business diversification.”

China Airlines’ commercial relationships with entities based in mainland China are also revealing of the new opportunities made available by China’s meteoric rise – even if other China-based carriers now operate world-class hubs that compete for dominance with CI’s Taipei hub.

Dimerco’s Lin agreed that support from local customs and a strategic partner, like China Airlines, reinforce Taipei’s competitiveness as an air cargo hub. Lin added that, from Taipei, “Dimerco can better meet critical points of cargo arrival at the terminal [and] cut-off times for documents,” while also expediting the customs clearance process. This assessment was seconded by DHL’s Mok, who noted that geography continues to solidify Taipei’s role as an Asian air cargo hub, especially “for cargo bound for the U.S.”

China Airlines’ Liu is also cognizant of Taiwan’s location in the South China Sea, which is why the carrier has recently pursued new partnerships with seafreight firms “to develop new courier sources and joint sea-air business opportunities.”

Such partnerships are especially relevant during peak season, “when demand for capacity is strong and airfreight rates are high,” said DHL’s Mok. Apart from peak season, seafreight poses little threat to Taiwan’s airfreight exports, as most of the shipments moving out of Taiwan by air are products such as high-end technology, “which need to be shipped by air, due to time-to-market pressure, and where margin is sufficient to afford air transportation,” Mok said. “Given the dominance of the technology sector in Taiwan, we don’t see the threat of diminishing airfreight volume.”