Sign for a Great Partnership
Dubai, United Arab Enirates – 25th June 2018: The media briefing and signing ceremony of the joint venture between Turkish Airlines’ Turkish Cargo successfully representing Turkey all around the world, Chinese cargo giant ZTO and Hong Kong based PAL Air Ltd. took place today in Istanbul.
The partnership regarded not only as a huge strategic step for Turkey prior to the opening of the Istanbul New Airport but a game changer for the global express transport business, was sealed and signed by Turkish Airlines Chairman of the Board and the Executive Committee, Mr. M. İlker Aycı, ZTO Express Chairman Mr. Mei Song LAI and PAL Air Ltd. Vice-Chairman Ms. Vivian Lau.
“Today, I feel privileged to welcome you all for the signing ceremony of a great partnership agreement between the biggest brands of China and Turkey. As Turkish Airlines, ZTO Express and PAL Air Ltd., we are announcing the signing of MoU to build a Joint Venture company to operate as a Global Express/ Courier company mainly focusing on Global E-commerce market with full door to door services. We are now delighted to make this strategic move into Global Express business together with the strong partnership of ZTO, the best and largest Express company from China and our long term cross border forwarding partner PAL Air Ltd. from Hong Kong. The Joint Venture, after reaching quickly to fully functional and operational levels, is expected to take place within the world’s largest integrators. In 5 years’ time it will generate over 2 billion USD of revenue. The growth is expected to continue gradually parallel to the e-commerce demand.
The Istanbul New Airport will be opened by 29th of October this year and it will function as Turkish Airlines main operating hub. This mega hub, will gradually provide Turkish Cargo up to 4 million tons of cargo handling capacity, becoming one of the top 5 air cargo brands of the world. The flow of e-commerce products globally with this Joint Venture and via Istanbul Mega Hub; will provide maximum value to our customers worldwide.” said Mr. M. İlker Aycı, Chairman of the Board and the Executive Committee, Turkish Airlines.
The services of the new global express joint venture company which will be based in Hong Kong, will include all door to door logistics activities; trucking, collection & distribution, freight transportation, cross docking and final mile delivery. It will also include warehouse management, order and supply chain management when necessary.
Alibaba Group amongst the partners
ZTO is the world’s largest parcel distributer, by daily 28 million parcels and additionally having the widest express delivery coverage in whole China. In fact, very recently global giant Alibaba Group announced that they were to buy 10% of the ZTO Express through an investment of USD 1.38 billion, deal expected to close within June.
PAL Air Ltd. on the other hand, has launched a B to C Wholesales Postal Express Service including last mile fulfillment to the Retail Express Services Providers in Hong Kong, China, Thailand, Vietnam, India and the USA.
Speaking at the ceremony, ZTO Express Chairman Mr. Mei Song LAI commented; “In 2017, ZTO's annual parcel volume reached 6.22 billion parcels. As the largest express delivery Company in the world, ZTO is an open platform built on core values of 'Co-create and Share'. Because of the innovation and globalization of new retail and e-commerce, China's logistics industry is provided with tremendous new growth opportunities. ZTO will continue to solidify and strengthen its competitive advantage for domestic growth, and will actively explore and expand international markets, building cross-border business as an important growth engine for the future.
The cooperation between the three partners will form synergy by combining strong core competencies and integrating key resources, and will undoubtfully effect positive progress in the areas of global express delivery, warehousing, cargo freight, and aviation route development and more, and will ultimately benefit traders and consumers globally.”
Pal Air Ltd. Vice-Chairman Ms. Vivian Lau said; “We are in one of the most exciting times of the human history. The IoT, robotics, artificial intelligence, 3D printing, VR/AR/MR will unleash unprecedented opportunities and challenges. To add to this list, the world is awaiting the launch of 5G which promises 10 gigabits per second, a hundred times faster than the current 4G technology. All these will provide further fuel to the already explosive e-commerce development.
PAL is honored to have played a role in creating a three parties venture that will unleash the best of three worlds, together with two global giants, Turkish Airlines and ZTO. Turkish Airlines, ZTO, and PAL looks forward to the creation of a world class integrator.”
Along with booming e commerce volumes, Global Express/ Courier industry continues to show outstanding growth rates. In 2016, this industry had around 260 Billion USD revenue realization and it is now expected to reach 340 Billion USD in 2020 and to more than 400 Billion in 2023. With this partnership all sides are all engaged to increase their capability and exposure significantly.
Turkish Airlines, operating the largest global airline network in terms of reached international destinations and countries as flying over 300 destinations in 121 countries, with this step, will expand its business scope and provide a seamless service to its customers from pickup to line-haul to door-to-door delivery. At the same time ZTO, and Pal Air Ltd. will broaden their market focus from domestic China to global markets by using Turkish Airlines’ world-wide exposure and network capability.