Hactl sees Chinese and Asian e-commerce growth

Hong Kong Air Cargo Terminals (Hactl) is expecting 2016 to remain challenging but the growth in Chinese and Asian e-commerce will provide growth, executive director, Vivien Lau tells Air Cargo Week (ACW).

Hactl, which celebrated its 40th anniversary in May, has seen more bulk e-commerce shipments for fulfilment centres closer to consumers, something that will help Hactl’s carrier customers as well as Hactl and its integrated logistics support services subsidiary, Hong Kong Air Cargo Services (Hacis).

Lau, who is also managing director of Hacis, tells ACW: “We are optimistic that the new e-commerce business into China and Asia, driven by a discernible trend to ship in bulk and handle fulfilment closer to the destination market, will continue to grow.”

She says 2016 has been challenging but in line with expectations following the year of contrasts in 2015.

“On the one hand, the slowing of Chinese manufacturing output impacted exports, but we began to see an increase in import activity – particularly e-commerce traffic, moving in bulk from overseas suppliers. Our value-added logistics subsidiary, Hacis, is gearing up to serve this fast-growing sector, with a new e-commerce depot at Nansha, and more planned.”

The slowdown in the Chinese economy has impacted Hactl’s business but Lau is expecting that the industrialisation of other countries in the region such as Myanmar, Thailand and Vietnam will help imports and exports in the region in the future.

Lau says: “Some of this trade will be with the West, while much will be intra-Asia. Because of Hong Kong’s established role as the major regional air hub for Asia and Australasia, with unmatched global and regional connections, we are optimistic that this regional growth will benefit Hactl.”

Hactl has also benefitted from being appointed the cargo handler for Myanmar National Airlines, which started four times a week Yangon – Hong Kong services on 4 December 2015 using a Boeing 737-800.

Lau says Hactl wants to take on more airlines but capacity constraints at Hong Kong International Airport (HKIA) are making this a challenge.

“Many new airlines have been approaching Hactl as part of their plans to set up new operations in Hong Kong, but their ability to appoint Hactl depends on their ability to obtain flight slots – and this is challenging while we have a two-runway system. We are providing new applicants with support whenever possible.”

The two biggest challenges in Hong Kong are capacity constraints and its distance from the residential areas but Hactl is successful in retaining staff.

Lau says: “Hactl’s long-term staff retention programme remains very successful in retaining staff, so that we are the only handler that does not resort to inexperienced agency labour. Our system and process upgrades have also improved our productivity per capita so that we can do more without increasing head-count.”

She says HKIA is close to saturation, and freighters are being pushed into nighttime slots, which causes short-term peaks in ramp handling activity but Hactl is coping.

“Hactl has coped very well with the changes, by investing in new mobile computing resources that have transformed our ramp operations and enabled them to adapt to the new situation.”

“But the ideal will be when we have a third runway, and can return to a situation of spare runway capacity and greater flexibility: so that more freighters can be handled throughout the day, more air services can be accepted into Hong Kong, and the airport’s cargo business can return to unconstrained growth.”