Taiwan's China Airlines buys 25 per cent stake in mainland cargo carrier

CHINA Airlines has become the first Taiwanese air carrier to gain a foothold in the mainland air cargo market, with the acquisition of a 25 per cent stake in the Yangtze River Express.

According to the controlling shareholder, Hainan Air Group, China Airlines has become the biggest overseas investor in the mainland air cargo carrier, with Taiwanese companies Yang Ming Line (Singapore) and Wan Hai Lines (HK) holding 12 per cent and six per cent stakes in the airline respectively.

Official China state media quoted industry insiders saying that the rapid development in the mainland air cargo market in recent years has attracted investments from overseas transport companies.

United Airlines estimate that the mainland currently accounts for a quarter of Asia's transpacific air cargo volume, on par with Japan.

The Xinhua report pointed out that the dramatic increase in demand for freight transportation in China has greatly outstripped the capacity available on local air cargo carriers. Yangtze River Express was established in 2002 and was a wholly owned subsidiary of Hainan Air Group, and was the second air cargo carrier to be set up on the mainland, the report added.

2006-1-19 8:43:35