Photo/Shetuwang

Jan.31 (NBD) -- Under the guidance of The Belt and Road Initiative, YTO Express' airline subsidiary YTO Express Airlines launched its first cargo flight to HK (Wuxi-HongKong-Xuzhou) Sunday, signaling another big step to its internationalization drive.

The airplanes that serve this route are Boeing B-757Fs with the flight number YG9041. The flight will be available every Monday, Wednesday, Friday and Sunday.

YTO Express said to NBD that Chinese e-commerce platforms aim to buy and sell globally, thus logistic companies like YTO have to deliver and serve globally, offering a brand-new delivery experience to worldwide consumers.

The delivery company has never stopped to push forward its internationalization drive. Last year, it acquired a controlling stake (61.87 percent) of the Hong Kong-based On Time Logistics and established a logistic alliance platform called Global Parcel Alliance (GPA).

YTO Express disclosed that its international logistic network covers 4 continents, serving over 50 countries and regions. Moreover, the company has more than 60 directly-operated international delivery facilities and over 1,000 overseas agents. In the future, more flight routes will be opened, expected to reach Russia, Malaysia, Philippine, Japan and etc. and to offer quality airline delivery services to customers.

NBD noticed that China Post is the biggest threat that hampers the internationalization of Chinese private delivery companies, as it even forced DHL, UPS, TNT, and FedEx to lower prices. To look for more possibilities, SF Express has teamed up with UPS to seek a new internationalization mode.

The traditional business-oriented parcel delivery market sees limited growth and is dominated by the above-mentioned 4 international delivery companies plus EMS. The new international parcels mostly come from e-commerce retailers. For a long time, SF has controlled the cargo airline between mainland cities and HK. YTO Express' newly opened route to HK directs the company to vast opportunities of the outbound market.

Xu Yong, chief consultant of the express consulting company CECSS, told NBD that international parcels are mainly in the hands of the top 4 international delivery companies, but the China market has a lot more to offer. According to Xu, YTO Express plans to use HK as a transit point to overseas countries, which can help reduce costs.

To provide what large international delivery companies cannot offer would be a way out for YTO Express. Xu suggested that the company should target the middle market and further explore opportunities in countries along the route of the Belt and Road Initiative.

The Belt and Road Initiative and cross-border e-commerce platforms offer huge opportunities for delivery companies. However, the competition will become fiercer. NBD noted that Best Logistics, a subsidiary of Best Express, has established two bases in the U.S. as well as service centers in German, the UK, Japan and Australia. STO Express also teamed up with Japan Post. 

Hui Mian, vice chairman of the China Society of Logistics, told NBD in an interview that delivery companies' international push is still at an early stage. There are more opportunities to be tapped and in the future the industry will become more regulated.

Email: tanyuhan@nbd.com.cn