China merger: More questions than answers

Certainly some of the more exciting air cargo news out of China for some time –according to reports first carried by China’s state media the People’s Daily and Xinhua news agency, China’s three largest cargo carriers will merge to form Asia’s largest cargo carrier.


China merger: More questions than answers


Certainly some of the more exciting air cargo news out of China for some time –according to reports first carried by China’s state media the People’s Daily and Xinhua news agency, China’s three largest cargo carriers will merge to form Asia’s largest cargo carrier.

The reports, quoting Zhou Laizhen, the deputy administrator at the Civil Aviation Administration of China (CAAC), said Air China Cargo, China Cargo Airlines and China Southern Cargo will merge. No timeline or financial information was given, but the fact the report cited a specific CAAC official tends to give quite high credence to it.

Of the effected parties the only response came from Air China Cargo’s Titus Diu who said he was unaware of the development, while no comment emerged from the other two.

It is a perplexing move and one wonders how it would be structured, in part because two out of the three cargo carriers are already joint ventures and one of the players is not only not a mainland carrier, but is also not a state-owned entity.

Air China Cargo is a joint venture between Air China Limited and Cathay Pacific Airways Limited while China Cargo Airlines on the other hand is a venture between China Eastern and China Ocean Shipping Company (COSCO) and China Southern Cargo is part of China Southern Airlines.