JD Logistics goes shopping for planes to tap air freight demand

JD Logistics aims to have "no fewer than 100 planes" by 2030.
JD Logistics aims to have "no fewer than 100 planes" by 2030.PHOTO: REUTERS

BEIJING (BLOOMBERG) - JD Logistics is planning to set up its own fleet of planes as the Chinese firm eyes a greater slice of a cross-border cargo market engulfed by global supply chain snarls.

The logistics arm of Chinese e-commerce giant JD.com aims to have "no fewer than 100 planes" by 2030, including leased and jointly purchased aircraft, said chief executive Yu Rui.

The company, which had previously chartered planes from airlines to transport goods, has already won approval from the Civil Aviation Administration of China to operate its own air freight business.

Businesses worldwide are scrambling for ways to move everything from masks to consumer electronics out of China as widespread lockdowns and delays in manufacturing led to jams at the country's sea ports.

Companies are increasingly turning to alternatives like air freight, but airlines are struggling to absorb the backlog and take in new orders, especially ahead of the Christmas shopping season.

"Covid-19 has heavily impacted supply chain-related industries globally. We've seen the shortage of shipping resources and air freight resources," Mr Yu said in an interview with Bloomberg TV.

While the pandemic-induced disruptions may not last long, the Covid-19 crisis has accelerated a shift to online shopping globally, creating new business opportunities for companies like JD Logistics, he added.

JD Logistics, which raised US$3.2 billion (S$4.3 billion) in a Hong Kong initial public offering in May, joins other internet giants in snapping up their own jets. Amazon.com, for one, is considering purchasing used long-range cargo jets in a bid to directly fly imports from China, Bloomberg News reported last week.

To grow its international business, the Beijing-based firm plans to beef up its overseas warehouse network, and will prioritise building highly automated delivery facilities in North America and Europe over the next two years. "We want to serve the cross-border logistics market through and through," Mr Yu said.