New China-Korea Air Cargo Pact to Cater to e-Commerce Industry

CJ Korea Express, South Korea’s largest logistics firm, has teamed up with two of China’s leading logistics companies to establish a new cargo entity, which will transport goods sold by China’s largest online shopping platform, T-Mall.

Under the partnership, Shanghai YTO Express and Alibaba Group’s courier service Cainiao will handle shipments in China while CJ Korea Express will be in charge of shipping goods manufactured by Korean companies. T-Mall is Alibaba's main on-line shopping mall and is the largest on-line platform in China.

With the launch of the venture, transportation time between China and South Korea will be reduced by an hour, making delivery much faster than before, CJ Korea Express said. “If the goods are delivered by plane, consumers could receive their orders a day after they paid online,” Yonhap News Agency quoted Lee Dong-soo, a public relations official at CJ Korea Express, as saying.

Lee noted that customers in Korea and China will benefit. “There are plenty of consumers using T-Mall in Korea. So they can receive their orders quickly,” Lee said. “At the same time, Chinese people who order Korean-made products can get their purchases earlier than before,” he added, “And the fast delivery will make Korean products more attractive.”

The announcement follows an agreement on parcel delivery services, made by CJ Korea Express and YTO in April, which marked the first time for companies from two countries to forge a cross-border delivery network.

Several major Korean retailers have opened shops on Alibaba’s e-commerce site. CJ O Shopping, Korea’s top cable home-shopping channel by sales, opened a flagship store on Alibaba Group’s Tmall Global platform, an extension of Tmall.com, last year.

Tmall Global exclusively carries foreign brands, allowing merchants around the world to access Chinese consumers without the need for a physical presence in China. Direct buying from overseas online malls reached more than 1.5 trillion won (US$1.3 billion) last year, according to the Korea Online Shopping Association, setting a new record.

Shanghai-based YTO Express, China's third largest logistics company, has 67 logistics centres and 600 branches across China, as well as a fleet four freighters.
In April last year, CJ Korea Express, a unit of food and entertainment conglomerate CJ Group, acquired a 51 percent stake in Smart Cargo, a Chinese logistics firm, to expand its business in China.
Smart Cargo, headquartered in Qingdao and Shanghai, was founded in 2002 and has nine branches in Beijing and other cities, four overseas offices in India, Vietnam, Mozambique and Zambia, and 200 agents worldwide.

Nol van Fenema

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