HIGHLIGHTS
- While the supply chain disruption is short-term, JD is currently preparing to set up its own air freight company, which was recently approved by the government.
- Both JD and Cainiao have the ultimate goal of delivering e-commerce shipments from China to around the world within three to four days.
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In the second quarter, the logistics unit of e-commerce giant JD.com launched its first self-operated charter flight, between Shenzhen and Bangkok, to tap into South-east Asia’s huge cross-border e-commerce growth.
Soon after, a second charter flight was added, between Nanjing and Los Angeles, operated by China Eastern, carrying apparel and fast-moving consumer goods from its Shanghai and Shenzhen warehouses.
CEO Yui Yu said: “Covid has heavily impacted the global supply chain industry and we’ve seen a shortage of resources in shipping and airfreight. While the supply chain disruption is short-term, JD is currently preparing to set up its own air freight company, which was recently approved by the government.”
JD was quick to control its own container shipping capacity, launching EShipping Gateways, a joint-venture with OOCL Logistics, which offers several sailings from Asia to North Europe.
He added: “In the future, we might also own airfreight companies in other countries. By 2030, I would say there won’t be fewer than 100 planes in JD’s fleet.”
JD Logistics will also “massively invest” in warehouses in North America and Europe over the next two years, building high-tech automated logistics centers to support to Chinese sellers who want to do business abroad.
JD rival Alibaba logistics-arm Cainiao is also expanding rapidly to overseas markets and is, perhaps, further ahead in terms of airfreight, having launched partnerships and charter agreements with several cargo airlines. Earlier this year, for example, it teamed up with Hong Kong Air Cargo for South-east Asian e-commerce shipments and this month bought a 20% stake in Air China Cargo.
Both JD and Cainiao have the ultimate goal of delivering e-commerce shipments from China to around the world within three to four days.
“Our business strategy is focused on an integrated supply chain, a market worth $311bn in 2020 and, with an annual growth rate of 9.5%, it will hit $497bn in 2025. JD logistics is already the top player in this market, but we only have a 2.7% market share,” he noted.
Minh Ngo
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