S.F. Express Plans to Boost Freighter Jet Fleet to 100 by 2018, Senior Executive Says

By Joanne Chiu

HONG KONG--S.F. Express Co. aims to more than double its freighter jet fleet to 100 by 2018, as one of China's largest privately owned express delivery companies seeks to tap the country's growing demand for e-commerce and logistics services, a senior executive said.

The company, with about one fifth of Chinese market share, currently operates 36 owned and leased Boeing freighters to deliver air cargo within the country. It also provides express delivery services to overseas countries including the U.S., Singapore, South Korea, Japan, Malaysia and Thailand through rented belly space of commercial aircraft operated by other airlines.

Li Dongqi, vice president of Shenzhen-based S.F. Express, said Wednesday this week that the company has been expanding into the fast-growing business-to-consumer online market in the past two years, through partnerships with major online retailers such as Alibaba Group Holding Ltd. as well as its own online shopping platform, sfbest.com.

"Business-to-consumer online sales have experienced an exponential growth rate of more than 50% over the past five years and I believe this growth trend would continue for a certain period of time," said Mr. Li.

He said S.F. Express--which is competing with China Postal Express & Logistics Co., a unit of state-owned China Post Group, and other privately owned operators such as ZTO Express and STO Express--aims to handle more than two million metric tons of cargo in 2018, up from a target of around one million tons this year, on the back of strong demand.

Mainland China's booming online-shopping market has fueled the growth of courier and logistics companies over the past few years, with local express-delivery companies such as S.F. Express expanding aggressively to meet the robust demand for online sales.

China's express-delivery industry handled 10.68 billion items in the first 10 months of the year, up 52% from a year earlier, with revenue jumping 42% to 159.2 billion yuan ($26 billion) during the period, according to China's State Post Bureau.

Write to Joanne Chiu at [e-mail]

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