Turkish Airlines, ZTO Express and PAL Air Ltd. have signed a MoU to build a joint venture to operate as a Global Express/ Courier company mainly focusing on Global E-commerce market with full door to door services. This strategic move into Global Express business brings the airline together with ZTO, the best and largest Express company from China and the freight forwarding company PAL Air Ltd. from Hong Kong.
The Joint Venture, after reaching full functional and operational levels, is expected to rank within the world’s largest integrators. In 5 years’ time it will generate over USD 2 billion of revenue. The growth is expected to continue gradually parallel to the e-commerce demand.
The services of the new global express joint venture company which will be based in Hong Kong, will include all door to door logistics activities; trucking, collection & distribution, freight transportation, cross docking and last mile delivery. It will also include warehouse management, order and supply chain management, if necessary.
“The Istanbul New Airport will be opened by 29th of October this year and it will function as Turkish Airlines main operating hub. This mega hub will gradually provide Turkish Cargo up to 4 million tonnes of cargo handling capacity, becoming one of the top 5 air cargo brands of the world. The flow of e-commerce products globally with this Joint Venture and via Istanbul Mega Hub; will provide maximum value to our customers worldwide.” said M. İlker Aycı, Chairman of the Board and the Executive Committee, Turkish Airlines.
ZTO is the world’s largest parcel distributer, by daily 28 million parcels and additionally having the widest express delivery coverage in whole China. In fact, very recently global giant Alibaba Group announced that they were to buy 10 per cent of the ZTO Express through an investment of USD 1.38 billion, deal expected to close within June.
PAL Air Ltd. has launched a B to C Wholesales Postal Express Service including last mile fulfillment to the Retail Express Services Providers in Hong Kong, China, Thailand, Vietnam, India and the USA.
Speaking at the ceremony, ZTO Express Chairman Mr. Mei Song LAI commented; “In 2017, ZTO’s annual parcel volume reached 6.22 billion parcels. As the largest express delivery Company in the world, ZTO is an open platform built on core values of ‘Co-create and Share’. Because of the innovation and globalisation of new retail and e-commerce, China’s logistics industry is provided with tremendous new growth opportunities.”
The cooperation between the three partners will form synergies by combining strong core competencies and integrating key resources, and will effect positive progress in the areas of global express delivery, warehousing, cargo, and aviation route development and more, and will ultimately benefit traders and consumers globally.
Turkish Airlines, operating the largest global airline network in terms of reached international destinations and countries as flying over 300 destinations in 121 countries, with this step, will expand its business scope and provide a seamless service to its customers from pickup to line-haul to door-to-door delivery. At the same time ZTO, and Pal Air Ltd. will broaden their market focus from domestic China to global markets by using Turkish Airlines’ world-wide exposure and network capability.