YTO goes west with new joint-venture airline and hub

Last week, executives from YTO Express, and its airline subsidiary, YTO Express Airlines, were in Shaanxi Province in central China finalizing an agreement to establish a new joint-venture cargo airline in the province’s capital city, Xi’an. The launch of Northwest International Cargo Airlines (as the airline will likely be known in English) will coincide with the construction of a new YTO Express sortation center in Xi’an.

Together the two projects form part of a provincial strategy to transform the logistics overlay across Shaanxi from the “edge” of existing networks, to the “frontier,” so that the Xi’an operation can serve as a logistics gateway to countries which lay to the west. YTO’s CEO, Weijiao Yu, said that site would serve as an important strategic location for parcels bound for Russia, Central Asia, and Europe.

YTO’s vision for its Shaanxi operations began to take shape in April of last year, when YTO’s CEO Yu Weijiao met with officers from the Shaanxi Provincial Government to explore ways in which YTO could support the development of a logistics center in the region. During the meeting, Yu outlined YTO’s plans to locate its Northwest Express delivery center and aviation base at Xianyang Airport (XIY) in Xi’an. Shortly after the April meeting, YTO Express Airlines Chairman, David Su Xiufeng inked an MoU with representatives from the Western Airport Group to establish a joint-venture airline in Xi’an – China Northwest International Cargo Airlines.

No fleet plans or launch dates for the new joint venture have been announced, but, last week, YTO Express Airlines firmed up an order with PEMCO for three 737-300 passenger-to-freighter conversions. Some of these aircraft could end up in the fleet of Northwest International Cargo Airlines.

YTO entered the own-airline game later than competitor SF Express, not taking redelivery of its first freighter-converted 737-300F until mid-2015, but it has expanded its fleet rapidly to five 737-300Fs (with one more in conversion at PEMCO) and last year became a launch customer for Boeing’s 737-800BCF program with an order for ten conversions.

Those interested in learning more about YTO Express Airlines or the impact of China’s “One Belt, One Road” initiative on air freight, should join us at this year’s Cargo Facts Asia in Shanghai, 25-26 April where a panel discussion will explore the topic. For more information, or to register, visit www.cargofactsasia.com.