Six months after the Civil Aviation Administration of China gave CDI Cargo Airlines the green light to launch operations, the carrier has commenced B737-300 service from its Hangzhou Xiaoshan International Airport hub to Changchun, via Qingdao. And although Asian cargo has been rather sluggish lately, CDI Cargo’s Alex Zhang told Air Cargo World that the nascent carrier is poised for success.
Unlike the Shenzhen-based Jade Cargo, which officially folded in June, and the Tianjin-based Grandstar Air Cargo, which suspended operations in May, CDI Cargo Airlines is targeting the domestic Chinese market for growth. Zhang believes this distinction will help the carrier offset some of the declines seen in the Asia-Pacific lately.
“No doubt that all long-haul/wide-body freighter operators are suffering a tough time at the moment, based on the current weak demand situation of international markets,” Zhang told Air Cargo World. “But most of the domestic/narrow-body freighter operators are performing well, due to booming domestic demand.” The Chinese express sector has been performing especially well recently, Zhang added, as evidenced by the sector’s nearly 30 percent CAGR increase.
But CDI Cargo sees potential beyond its domestic market. Eventually, Zhang said, the carrier is looking to launch international operations with wide-body freighters. Now, however, CDI Cargo will focus on the 737-300Fs, with two more aircraft coming on board in October and December.
“To set up the organization properly and [garner] a healthy financial base, CDI will be focusing on domestic routings with narrow-body freighters during the beginning phase,” Zhang said. “But we will keep our eyes on the development of international markets and prepare ourselves for international operation when the markets are recovered.”
The road to recovery may be long, however. Last month, the Association of Asia Pacific Airlines revealed that freight demand fell 0.8 percent, year-over-year, in the Asia-Pacific in June, amid a capacity decline of 1.4 percent. Cargo carriers in the region also recorded a sluggish cargo load factor of 67.8 percent.
From a half-year perspective, Asian cargo demand looks even more depressed. AAPA Director General Andrew Herdman said that Asian airlines’ saw a 4.3 percent, year-over-year, drop in freight demand in the first six months of the year, a byproduct of “weak consumer confidence in major developed markets.”