Shanghai, September 3, 1996 -- According to Federal Express (FedEx), the company begins expanded flight operations today that add significant additional access for Chinese importers and exporters through direct, regularly scheduled all-cargo flights linking Shanghai directly with the company's Asia Pacific Hub in Subic Bay, Philippines.
The service with a FedEx DC-10 aircraft and crew begins today. It is the first direct flight connecting China to FedEx's hub and linking China into the extensive FedEx AsiaOne network which now connects 13 major commercial and financial centers in Asia overnight.
"The significance of today's launch of an additional spoke to the hub-and- spokes concept we implemented in Subic Bay is enormous. It means that customers in Shanghai and Beijing can now ship and receive packages between China and the US and rest of Asia, "says Mike Ducker, senior vice president for Asia Pacific Division.
FedEx's initial strategy in Asia was to establish its first hub, and it selected an ideal site on the former US Navy base in Subic Bay to achieve this goal last year. The company's mid- to long-term strategy includes expanding operations at the Subic Bay hub and adding additional spokes to the hub over time. Today's announcement is a tangible and important example of the company's ongoing commitment to the expansion of services, and is a milestone event in Asia, according to Mike Ducker.
FedEx pioneered the hub and spokes concept in the US operations many years ago and is implementing a similar strategy in its international operations.
FedEx received permits and licenses in 1995 from both the Civil Aviation Administration of China (CAAC) and the US Department of Transportation (DOT) to operate an all-cargo route purchased from Evergreen International Airlines, Inc. With this approval, FedEx is recognized by the CAAC as the sole US-based all-cargo carrier with aviation rights to China.
"The eastbound movement out of Shanghai and Beijing through Narita in Japan gives direct access to JFK airport in New York, one of the world's most important cargo hubs. From there, shippers can easily access other important global markets through FedEx networks in North America, South America, and Europe. Not only that, this new connection provides extensive access into Asia Pacific's largest and most comprehensive intra-Asian overnight service -- all through FedEx's extensive linehaul system, "says John Quinn, vice president for China and Mid-Pacific operations.
FedEx began flying its own aircraft to and from China in March 1996. It now has all three critically important components in place for extensive service. These include: its own scheduled linehaul; reliable door-to-door pick-up and delivery to 60 cities; and consistent and fast customs clearance.
Initially entering the China market in 1984, FedEx's operations were further enhanced in 1994 when it became the first express transportation company to be linked electronically with China Customs. This now means that information, in many cases, can be transmitted to customs authorities in Beijing and Shanghai before shipments actually arrive at the airports.
"Plans for the China market include adding service destinations, with the total cities directly served in China currently standing at 60, and this number is targeted to increase by 20 per year for the next five years. With the Subic Bay connection, we now have two frequencies per week from Beijing and Shanghai into Asia, and we have permission by China authorities to further increase by two frequencies per week. There is, literally, no other all-cargo carrier which can meet service levels and standards," Mr. Quinn added.
FedEx currently services the Asia Pacific market with nearly 3,700 employees serving more than 30 countries and territories. The company provides the most extensive trans-Pacific air lift of any major competitor. Operating its own wide-bodied MD-11, DC-10 and A310 aircraft, FedEx offers 150 flights per week to Shanghai, Beijing, Tokyo, Osaka, Hong Kong, Kaohsiung, Taipei, Seoul, Singapore, Kuala Lumpur, Penang, Manila and Subic Bay.
On a global basis, FedEx serves 211 countries, providing fast and reliable services for approximately 2.5 million items each working day. The company has more than 123,000 employees, over 560 aircraft, 36,000 vehicles, and nearly 180,000 Powership® and FedEx ShipTM automated shipping systems in its integrated global network. Daily global lift capacity is approximately 15.3 million pounds (almost seven million kilograms). Federal Express reported revenues of US$10.3 billion for its 1996 fiscal year.
