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DHL and Air Hong Kong extend their tie with a new 15-year agreement
DHL Express has extended to 2033 its Air Hong Kong (AHK) agreement, which grants DHL Express access to AHK's overnight air services.
As part of the deal, DHL Express and AHK formalised a reorganisation announced in July, under which majority owner Cathay Pacific will buy out DHL Group's 40 per cent stake in AHK. Under the terms of the new agreement, DHL will also purchase AHK's eight A300-600 freighters, which will be leased back to AHK. The deal goes into effect on January 1, 2019.
Once the deal takes effect, DHL will initially have the same access to AHK's capacity granted by its current agreement, but over time will have more access to flexible aircraft deployment and route selection to support DHL's growth in the Asia-Pacific region, according to New York's Air Cargo World.
"With Hong Kong's merchandise exports between January and September 2017 growing by 8.5 per cent compared to last year, we're keenly aware of the upward momentum that the region's trade lanes are facing," said Ken Lee, DHL Express Asia Pacific CEO. He added that the deal offers the "greater flexibility" DHL needs to handle any unpredictable changes or demand increases in the region.
Cathay Pacific Chief Executive Officer Rupert Hogg said: "Air Hong Kong is a joint venture between Cathay Pacific and DHL that has proven extremely valuable to both our businesses, and we expect it to yield even better results and operational agility in its newest iteration.
"With Air Hong Kong becoming a wholly-owned subsidiary of our group, and with the block space agreement in place, these will enable us to invest in the long-term success of Air Hong Kong, which benefits from the prospering express air cargo market in the region, and capture the abundant business opportunities that are prevalent."
DHL Express recently announced the expansion of its Central Asia Hub in Hong Kong, a dedicated and purpose-built air express cargo facility at the Hong Kong International Airport. The expansion will add an additional 8,000sqm of space as well as new technologies including automated X-ray inspection machines and material handling systems.
As part of the deal, DHL Express and AHK formalised a reorganisation announced in July, under which majority owner Cathay Pacific will buy out DHL Group's 40 per cent stake in AHK. Under the terms of the new agreement, DHL will also purchase AHK's eight A300-600 freighters, which will be leased back to AHK. The deal goes into effect on January 1, 2019.
Once the deal takes effect, DHL will initially have the same access to AHK's capacity granted by its current agreement, but over time will have more access to flexible aircraft deployment and route selection to support DHL's growth in the Asia-Pacific region, according to New York's Air Cargo World.
"With Hong Kong's merchandise exports between January and September 2017 growing by 8.5 per cent compared to last year, we're keenly aware of the upward momentum that the region's trade lanes are facing," said Ken Lee, DHL Express Asia Pacific CEO. He added that the deal offers the "greater flexibility" DHL needs to handle any unpredictable changes or demand increases in the region.
Cathay Pacific Chief Executive Officer Rupert Hogg said: "Air Hong Kong is a joint venture between Cathay Pacific and DHL that has proven extremely valuable to both our businesses, and we expect it to yield even better results and operational agility in its newest iteration.
"With Air Hong Kong becoming a wholly-owned subsidiary of our group, and with the block space agreement in place, these will enable us to invest in the long-term success of Air Hong Kong, which benefits from the prospering express air cargo market in the region, and capture the abundant business opportunities that are prevalent."
DHL Express recently announced the expansion of its Central Asia Hub in Hong Kong, a dedicated and purpose-built air express cargo facility at the Hong Kong International Airport. The expansion will add an additional 8,000sqm of space as well as new technologies including automated X-ray inspection machines and material handling systems.
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