Asia’s First Freight Airport to Open in Ezhou, Hubei, SF Express to Invest 2.3B Yuan

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SF Express Holding announced its wholly owned subsidiary Shenzhen SF Tyson Holdings had signed a cooperation agreement with the Hubei Provincial Government. SF will build the world’s fourth and Asia’s first professional freight airport in Ezhou.

According to the announcement, Hubei Traffic Investment Group, SF and Shenzhen Nongyinkonggang Investment will establish a joint venture company with share proportions distributed at 49 percent, 46 percent and 5 percent. The joint venture company is registered in Ezhou, Hubei province, with 5 billion yuan of capital. SF has invested 2.3 billion yuan and has a 46 percent stake.

SF announced in its statement when the airport management institution receives a Civil Airport Use License from by the Civil Aviation Administration, SF Tyson will become the controlling shareholder of the joint adventure. SF Tyson will directly or indirectly hold more than 50 percent of the equity by one or multiple transfers from Nongyin Investment.

According to the announcement, the Ezhou Hub Airport is a large, customized airport for SF, mainly to cater to the operation of transit shipments and traditional air freight transportation.

SF Express owns 40 cargo aircrafts, which is more than other companies. And recently, SF bought another two Boeing 747s online. In the first half of the year, total air cargo volume reached 514,000 tons (via SF aircraft, outsourcing outsourcing and aircraft’s bellyhold), accounting for more than 20 percent of domestic total.

Ezhou is located in the geographic center of China, less than 100 kilometers from Wuhan. But the more important reason is the different nature between passenger and cargo transportation. Passenger transport values efficiency, and passenger routes are point to point. But freight transport pursues scale, and it improves efficiency by transporting a batch of cargo into a hub airport and transfering it.

Additionally, available land is plentiful in Ezhou, and its airspace is not as congested as in a first- or second-tier city. In addition, Ezhou is located beside the Yangtze River, and there are multiple high-speed rails passing through the city. It can complement air transportation and establish an intermodal transportation network. In the announcement, SF said it would build an “multi-modal transport hub and international logistics base” in Ezhou.

The world’s three big cargo airports are all in the United States: namely Memphis Airport, belonging to FedEx; Louisville Airport, belonging to UPS; and Anchorage Airport in Alaska. Asia’s largest cargo transit hubs are Hong Kong, Shanghai Pudong Airport and South Korea’s Incheon Airport.

According to the business forecast, Ezhou Airport is expected to have a throughput of 2.45 million tons of cargo and one million passengers by 2025. In 2045, it is expected to handle 7.65 million tons of cargo and 15 million passengers. The Ezhou Airport will begin construction in the near future, and will be completed around 2020.

This article originally appeared in Jiemian and was translated by Pandaily.
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