Another courier company has joined the "air battle".
According to the Changsha Evening News, on December 14th, Zhongtong Cargo Airlines and related industry projects signed a contract in Changsha, becoming the first cargo airline in Hunan to plan to land.
The investment amount of Zhongtong Freight Airlines and related industrial projects signed and landed this time is 11 billion yuan, with a total land area of about 750 acres. The proposed landing projects include six major sectors: Zhongtong Freight Airlines, Zhongtong Express Huazhong Headquarters, Zhongtong Cloud Business Intelligence Valley Industrial Park, Zhongtong Cross border E-commerce Headquarters, Zhongtong Financial Business and Talent Supporting Residential Projects.
This means that Zhongtong, which had little layout in the air cargo sector before, has taken a substantial step forward. Regarding the intention and planning of Zhongtong Express to layout air freight, Time Finance contacted Zhongtong Express, who stated that there is currently no further disclosure to the public.
Layout Cargo Airlines, China Unicom Bundles with Hunan Airlines
In recent years, various express delivery companies have gradually developed their air cargo capabilities, from establishing airlines, purchasing aircraft, to participating in the construction of airports, their layout of air cargo has become increasingly deep.
In August of this year, the important supporting project of Yuantong Jiaxing's global aviation logistics hub, "Dongfang Tiandi Port," officially started construction and is expected to be completed and put into operation in July 2026. The hub project was signed and jointly constructed by Yuantong and the Jiaxing Municipal Government in Zhejiang in 2020. After completion, it will introduce Yuantong Aviation and Yuantong Commerce Headquarters to provide more cost-effective cross-border supply chain logistics services.
JD's participation in the construction of Nantong Airport has also made progress. In January of this year, the Nantong Transportation Bureau issued the "Nantong Airport Air Cargo Development Action Plan", further promoting the layout and construction of Nantong Airport in logistics. In 2018, the Nantong Municipal Government signed a strategic cooperation framework agreement with JD Group, clarifying that JD will use Nantong Airport as its main operating base and establish JD Cargo Airlines in Nantong. In January 2022, JD's first passenger to cargo aircraft arrived at Nantong Airport for pre flight preparations.
However, currently only SF Express Holdings has landed a self built airport. In July 2022, SF Express participated in the construction of Hubei Ezhou Huahu Airport, which became the first professional cargo airport in China. Starting from September this year, SF Express Transfer Center, the core cargo facility of Ezhou Airport, has gradually been put into use.
Zhongtong Express has placed its focus on air cargo transportation in Changsha, Hunan. Hu Hongqun, Director and Vice President of Zhongtong Express Group, stated that Hunan has obvious geographical advantages and strong development momentum in modern logistics industry. In recent years, Zhongtong has invested 2.053 billion yuan in Hunan, including 1.05 billion yuan in Changsha.
At this time, Zhongtong Express's heavy investment in air cargo entering the bureau was somewhat delayed, and it was not without ideas before. In March 2018, Zhejiang Xinglian Air Cargo Co., Ltd. was established, with Zhongtong Express as an indirect shareholder; In 2019, Zhongtong Express began trial operation of the high-end air cargo delivery product "Starlink Aviation Time Limited Items", covering 8-48 hours of express delivery services in China.
Unlike self built airlines such as SF Express and YTO, at that time, Zhongtong mainly cooperated with airlines and air freight forwarding companies, and intervened through a "light asset" model to test the waters. And for the establishment of a cargo airline, Zhongtong has brought Hunan Airlines to jointly establish a cargo airline.
Hunan Airlines is the only local airline in Hunan Province, which made its maiden flight on May 21, 2016. Its main operating base is Changsha Huanghua International Airport, and it operated a total of 63 routes throughout 2022.
Price war erodes profits, and Zhongtong accelerates its overseas expansion
Improving profit performance by creating high value-added services is one of the reasons why Zhongtong Express has increased its investment in air freight at this time.
Since the beginning of this year, almost every express delivery company has felt the challenge of single ticket revenue. Zhongtong Express's core express delivery business single ticket revenue has continued to decline. From the first quarter to the third quarter, its core express delivery business single ticket revenue decreased by 3.7%, 7.8%, and 13.5% year-on-year, respectively.
In order to break free from price wars and increase profit margins, Zhongtong has also increased its high-end shipping business in the cold chain and pharmaceutical supply chain since the beginning of this year. However, a middle-level express delivery company pointed out to Time Finance that currently there is not much space for air freight to serve ordinary domestic express delivery services, and high-end markets such as cold chain have been basically monopolized by SF Express and JD.com.
The person believes that it is too late for Zhongtong to increase its focus on the domestic aviation component market at this time. "The future focus is on going abroad, and Zhongtong's current layout of aviation should also be based on the needs of cross-border e-commerce, using air transportation capacity to go abroad." Among the projects signed and landed by Zhongtong in Changsha this time, including its cross-border e-commerce headquarters.
As early as 2014, Zhongtong Express attempted to enter the international market and successively expanded into markets such as Southeast Asia, Europe, and Africa. In 2018, China Telecom also established joint ventures with Türkiye Airlines and Pacific Airlines; And in 2019, when Chinese express delivery companies sparked a wave, they invested in the cross-border logistics provider Suda Africa in China.
However, overall, Zhongtong, which ranks first in the domestic express delivery industry, still has a relatively slow pace of going global. Lai Meisong, Chairman of Zhongtong Express, also stated in a public event this year that Zhongtong Express's strategy is to "strengthen its main business and actively go global", that is, first to strengthen and optimize its main business in the Chinese domestic market, and then actively embrace and enhance its ability to go global.
And this time, Zhongtong Express may have the intention to gradually increase its cross-border business layout by establishing a joint venture air freight company and signing a cross-border e-commerce project.
Hunan Airlines has also announced this year that it will actively apply for an approved international air transportation operating license and strive to open routes from Changsha to Southeast Asia as soon as possible, which is in line with the current main direction of China Unicom's overseas expansion.
At present, with the rapid growth of domestic cross-border e-commerce, many express delivery companies have also increased their international logistics layout, hoping to get a share of the pie.
Since the beginning of this year, Cainiao, Jitu, and SF Chasing Deer Capital have been hoping to expand their internationalization capabilities; On December 13th, YTO Airways opened regular cargo routes from Wenzhou to Seoul and Wenzhou to Manila, mainly carrying cross-border e-commerce small packages and other goods. "For express delivery companies, there are still opportunities and space to expand in the international market," said the middle-level personnel of the aforementioned express delivery companies.