ACC is looking to India to fill some of its new main-deck capacity. It has obtained approval for the Shanghai-Chennai sector and aims to fly the route three days a week. “We plan to combine it with Chongqing,” said Titus Diu, Air China Cargo’s COO. The up-and-coming destination in China’s interior will be served on the return leg from India to Shanghai. “We can carry cargo from India, plus we can feed traffic from Chongqing to our intercontinental departures out of Shanghai,” Diu said.
Elsewhere in Asia, ACC is looking at Dhaka, Singapore and Ho Chi Minh City. Applications for these destinations are in the pipeline, but management has not yet made a final decision on routes and frequencies.
The second focus for the carrier’s freighter expansion is China’s interior, where the migration of manufacturing has driven up demand for airfreight capacity. This started last year, when the ACC venture was preparing for take-off, with the introduction of Chengdu into the network. Same as with the planned Chennai-Chongqing operation, Chengdu was inserted into a route from Europe to Shanghai, so ACC could top up its flights in Chengdu with cargo headed for intercontinental departures out of Shanghai.
Zhengzhou, the third of the up-and-coming production centers in China’s interior, is next on the agenda. “We plan to have Zhengzhou in the network early in the second quarter of this year,” Diu said. One likely routing would see the new gateway added as a stop in both directions on a new Shanghai-Europe flight, Diu confirmed.
The ability to combine the emerging markets in the interior with its Shanghai hub for international routes is a considerable advantage for ACC vis-a-vis its competitors from Europe and North America, especially at this stage of development. As Diu pointed out, output in the newly established factories in Chengdu, Chongqing and Zhengzhou can go through significant swings at this point.
“Because the production schedule is not stable yet, output is based on actual demand, which fluctuates quite a lot. The tonnage is significant, but it’s not evenly distributed through a month or a quarter,” he explained.
It helps that parent company Air China has passenger flights to the emerging Chinese markets, although some of this is narrow-body capacity. ACC has been tapping into Chongqing with a twice-weekly freighter run to Shanghai. This will be scrapped once the Chennai-Chongqing-Shanghai operation is in place.
One of the first domestic sectors where ACC fielded freighters was the Hong Kong-Shanghai route, a move designed to feed exports from the Pearl River Delta to ACC’s long-haul connections out of Shanghai. The feeder operates four times a week and will go up to six weekly frequencies when the new capacity is ready, Diu said.
These developments have changed the nature of the carrier’s cargo business. From a predominantly point-to-point character, this has shifted more and more to a focus on transit traffic, notably through Shanghai. This is a major reason why management is looking to replace its operating system this year. This quest is now in the final stage of vendor selection, reported Diu. He hopes that the new system will be in place some time in the first half of next year.
By then, management should have made the next fundamental decision — the next generation of ACC’s freighter fleet. In the current climate, with 747 Classics largely gone from the market, the 747-400BCF ranks among the less-efficient large wide-bodies. More pressingly, China’s aviation regulations stipulate that aircraft age should not exceed 25 years.
“We are looking at the 777, the 747-8 and the A330F,” Diu said.