Air freight forwarder ASR Holdings is seeking a listing in the Hong Kong stock market, with a plan to raise more than HKD100 million to fund expansion in Asia and Europe. ASR said its cargo volume rose 7.35% in the four months to October to an average of 3,052 tons per month, attributing this to a focus on emerging markets. The listing is sponsored by Shenyin Wanguo, while Oriental Patron is the book runner. In a filing with Hong Kong Exchanges and Clearing ASR said its net profit more than doubled to HKD92 million in 2010 from a year earlier. It had a net profit of HKD59.4 million in the first six months of last year – up 42.1% from 2010. Instead of competing for cargo from shippers, ASR purchased air space from airlines and freight carriers, such as Fedex and UPS, and organized time slots, space and priorities for freight forwarders. ASR plans to open a logistics center in a southern city such as Dongguan or Shenzhen to provide one-stop services from warehousing, trucks and documentation to couriers. It also aims to develop an electronic booking system by 2013. Finally, it plans to triple the number of China sales offices from 11 to 33 and add seven sales points in Europe in the next three years. Two new subsidiaries will also be set up in the Philippines and Singapore.

Jade Cargo International Co, China’s first air cargo joint venture, has suspended its service as the Asia-Pacific freight market is hampered by weak demand. The suspension is to be temporary. Shenzhen Airlines owns 51% of the joint venture, Lufthansa Cargo 25% and the German development bank DEG owns 24%. Jade Cargo was founded in 2004 and, until the suspension, operated a fleet of six B747s, which fly to destinations including Frankfurt and Dubai, as well as to Shanghai, Chengdu and other Chinese cities. Earlier media reports said Lufthansa Cargo intended to withdraw from the Chinese market. “We are leaving all options open,” Karl Ulrich Garnadt, CEO of Lufthansa Cargo, said at the Reuters Global Manufacturing and Transportation Summit in December. Beyond the weak demand for air shipping, Garnadt said Lufthansa Cargo had known for years that Jade Cargo was undercapitalized. Lufthansa Group CEO Christoph Franz said in October that the company would review its investment in Jade Cargo. Asia-Pacific freight carriers have seen the steepest decline in transport volumes as a result of U.S. and European consumers’ falling demand for goods manufactured in Asia. From November 2010 to November 2011, shippers in the region saw the volume of goods they were transporting decline by 6.4%. Chinese carriers may be interested in owning shares of Jade Cargo, both because it is a small company and because they are likely to be inexpensive, the China Daily reports.

Cathay Pacific Airways is struggling to fill up its cargo space even as its freight capacity is set to increase by 15% to 20% next year with the delivery of the 10 747-8 freighters it ordered. The 747-8 can hold 16% more cargo than its predecessor the B747-400F. “The worst-case scenario is that we’ll have to park the aircraft, just as we did during the downturn in 2008 and 2009,” Nick Rhodes, Cargo Director for Cathay, said on the sidelines of the topping out ceremony of its HKD5.5 billion cargo terminal at Chek Lap Kok airport in Hong Kong in mid-November. To help ease the overcapacity, a B747-400F was transferred to its cargo joint venture with Air China. Three more freighters will be leased to Air Hong Kong, a joint venture in which Cathay owns a 60% stake. Still, Cathay’s cargo capacity is expected to rise by up to 20%. Its cargo volume, meanwhile, contracted more than 17.5% year on year in October and the load factor dropped to 66%. Cathay’s load factor and the cargo division’s profitability would drop next year as a result of weak economic growth in Europe and North America, Rhodes said. “[But] it’s not all bad, imports into Asia, especially for China, are quite strong,” he said. Cathay is planning new routes to the mainland and India as well as new markets in eastern Europe, and Central and South America to use the additional capacity. It opened a new service to Zaragoza in Spain in November after the rapid growth of retail chain Zara in Asia. Cathay also wants to add more services to Sri Lanka and is seeking new services into Australia and Mexico via Los Angeles, pending traffic rights talks. It is increasing the five flights a week on its Miami route to seven because of the growth in traffic between Asia and Central and South America. In the longer term, the International Air Transport Association (IATA) forecasts global air cargo demand to rise 6% a year in the next decade. Cathay’s capacity in the next three years is to grow 5% to 6%, in line with global forecasts for demand. The new cargo terminal at Chek Lap Kok, with annual throughput capacity of 2.6 million tons, will hire up to 1,800 staff next year. About 1.8 million tons of cargo that Cathay, Dragonair and Air Hong Kong carry a year will be moved to the new terminal in phases from Hong Kong Air Cargo Terminals, the South China Morning Post reports.

Airbus opened a logistics company in Tianjin to provide support services for all the aircraft maker’s programs in China. Airbus (Tianjin) Logistics Co (ATL), the first such center for Airbus in Asia, will handle all the company’s transportation needs, including materials and plane parts, between China and Europe. The logistics center is situated in the Tianjin Free Trade Zone Comprehensive Bonded Area, close to other Airbus facilities, including the assembly line for the A320 aircraft. The center will coordinate the supply from Airbus partners in six cities: Harbin, Shenyang, Tianjin, Xian, Chengdu and Shanghai. As the number of Airbus programs increases in China, the cost of logistics is a major concern for the aircraft manufacturer. “The logistics center in Tianjin has the potential to help us reduce costs by as much as 30%, according to our experiences in the U.S.,” said Laurence Barron, President of Airbus China. ATL has already supplied services for Airbus’ two programs in China. One is the manufacture and assembly of wings for the A320. ATL is able to supply logistics services for 40 containers of A320 wings annually, which almost equates to the production capacity of the A320 wing assembly line. Another program relates to the testing of wing slats manufactured by a Belgian company, which opened a factory next to ATL in November. The logistics center will also support Airbus’ latest aircraft, the A350 XWB, of which 5% of the airframe will be manufactured in China, Barron said. Airbus spends a lot of time and energy on the harmonization of transportation and management of the supply chain, which was previously owned separately by suppliers, he added.

Limited direct air cargo connections between China’s inland provinces and Europe and North America are a “huge challenge” to manufacturers seeking to export goods to foreign markets, industry insiders say. Demand from hi-tech manufacturers and suppliers that have moved operations to cities in western provinces for air cargo capacity from inland airports was not being met, warned Andy Weber, President of logistics’ firm Kuehne+Nagel (Asia-Pacific) Management. Cathay Pacific, however, is due to launch dedicated, twice-weekly cargo flights between Chengdu, Shanghai and Hong Kong. James Woodrow, the airline’s General Manager for Cargo Sales and Marketing, said the service was aimed at customers operating in the hi-tech clusters of Chengdu – home to Foxconn, Texas Instruments, Intel, Dell, and Apple; and Chongqing – home to Hewlett-Packard, Acer, Asus and Cisco. “Cathay Pacific will therefore be increasing capacity between both Chengdu and Chongqing and Hong Kong over the coming months and years,” he said. In November, the airline will move from operating two freighters per week from Chongqing to four a week. Kuehne’s Weber said few carriers offered direct services from the inland provinces to the United States or Europe. Instead, cargo has to be flown to Shanghai or southern cities or trucked to the nearest port. The handful of cargo carriers operating routes serving the area include Jade Cargo International, in which Shenzhen Airlines holds 51% and Lufthansa 25%. It operates a daily direct flight between Chengdu and Amsterdam. Air China Cargo also flies between Rome, Chengdu and Shanghai, while Korean Airlines operates a twice-weekly service between Chengdu and Seoul, and Yangtze River Express has a service between Chengdu, Luxembourg and Prague. Kuehne+Nagel plans to open 10 offices this year, including four in central and western China in the next three months. Eight depots, including operations in Chengdu and Wuhan, will also be opened this year. “We are now in 46 locations in China. We aim to expand to around 60 locations by the end of 2012, particularly following the `Go-West’ market trend,” Weber said, as reported by the South China Morning Post.