Move reflects soaring growth in express-delivery sector
China Postal Airlines said on Tuesday that it has signed an agreement with Boeing Co for 17 aircraft, the largest purchase order in the airline's history.
It is the latest example of the expanding Chinese express-delivery sector, with SF Express and YTO Express also increasing their aviation transport capacity this year.
The order is for 10 Next-Generation 737 Boeing Converted Freighters (BCF) and seven Boeing 757-200s that the carrier plans to convert into freighters, taking the fleet size to 43 aircraft.
"The purchase could quickly increase transport capacity, fill in the gap of the EMS market demand and relieve the pressure on some routes," Li Xiong, vice general manager of China Post Group, said at a press conference.
According to the carrier, the Boeing 757-200s are expected to be put into service next year.
Established in 1996, China Postal Airlines is the first airline to target the cargo transport market in China.
Using the brand of EMS, the company has 26 aircraft including four Boeing 757 freighters. Its network extends to more than 300 cities in the Chinese mainland, as well as to South Korea and Japan.
The company hopes to tap the European and US markets by the end of the 13th Five-Year Plan period (2016-20), Li Yufeng, president of China Postal Airlines, told the Global Times on Tuesday.
The 737-800 is the first Next-Generation 737 that Boeing will offer for conversion. Together with China Postal Airlines, YTO Express-backed YTO Airlines, which is based in Hangzhou, capital of East China's Zhejiang Province, is also a launch customer for the new Boeing BCF program.
Boeing said the 737-800BCF could bring to the freighter fleet more advanced avionics, better fuel efficiency and lower operating costs.
The fleet expansion is in line with the robust development of China's express-delivery sector in recent years.
Figures from the State Post Bureau show the number of parcels handled by express-delivery companies in China reached 14 billion in 2014, the world's highest volume.
Income of the express-delivery sector reached 245.6 billion yuan ($38.51 billion) in the first 11 months of this year, up 34.9 percent from the same period last year.
The China air express market is forecast to be among the fastest-growing segments of the world air cargo market.
According to the Boeing World Air Cargo Forecast, world air cargo traffic will grow 4.7 percent annually over the next 20 years, with China's domestic and intra-Asian markets expanding 6.7 percent and 6.5 percent annually, respectively.
However, Li Yufeng from China Postal Airlines said the company is also facing competition in the domestic and overseas markets.
Private-sector SF Airlines Co, a subsidiary of SF Express, received its fourth freighter in November, taking its freighter fleet to 42. The company plans to build a cargo hub in Central China's Hubei Province.
YTO Airlines, the third logistics company to have its own aircraft after SF Express and China Postal Airlines, received its second Boeing 737-300 freighter in November. In September, the company ordered 15 Boeing freighters, and it plans to increase its fleet to 30 to 50 planes by 2020.
In November, US-based FedEx Corp said in Shanghai that it will shorten the delivery time by one day for international express business in six cities including Fuzhou, capital of East China's Fujian Province, Xiamen, Fujian Province and Chengdu, capital of Southwest China's Sichuan Province.
