China's STO Express Start Freighter Service to Europe

Shanghai-based STO Express, one of China's rapidly expanding express operators, has launched the first regular freighter service to Europe by any Chinese express carrier.

STO Express starts Europe service with Silk Way B747-8F – courtesy HACTL
STO Express starts Europe service with Silk Way B747-8F – courtesy HACTL

The new service, which was launched last week, flies from Hong Kong to Prague using a B747-8F operated by SW Italia, a Silk Way Airlines subsidiary. 
Milan Malpensa-based SW Italia is a joint venture between Azerbaijan- headquartered Silk Way Airlines (42%) and Italian investors Ignacio Coraci and Francesco Rebaudo (58%). Until recently, SW Italia operated one B747-400F, which was transferred from the fleet of Silk Way West, the international cargo operator in the Silk Way Group, headquartered at Heydar Aliyev International Airport in Baku, Azerbaijan.

STO Express thinks big
Last May, SW Italia leased out their sole B747-400F to Qatar Airways and as a result, the new STO Express freighter thrice-weekly service from Hong Kong to Prague is operated by a B747-8F owned by Silk Way West Airlines, the other cargo operator in the Silk Way Group. The aircraft is fitted with an STO Express livery. From Prague, the express operator will use its own truck fleet to carry packages from Prague to all countries in Europe, including the UK.
STO Express said that in the next one or two years, it wants to acquire a 25% stake of the China-related express and e-commerce market from the three global delivery firms DHL, UPS, and FedEx.
"Having our own freighter and truck fleet will save costs for customers, reduce delivery times by 3-7 days and we can now provide customers with a complete delivery tracking service," said Wayne Yu, vice-president and operations director of STO Express Europe.

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The e-commerce bonanza seems to continue unabated
STO's freighter service to Europe coincides with a continuing boom in cross-border e-commerce activities. Chinese research firm iResearch statistics show China's cross-border imports grew from 100 billion yuan ($15 billion) in 2014 to 150 billion yuan last year and are forecast to hit 210 billion yuan this year.
The mainland’s express delivery companies have grown at an annual rate of 30% in the past five years in tandem with the exponential growth of the e-commerce market. Apart from STO Express, other major players include SF Express, YTO Express, STO Express, ZTO Express and Yunda Express.
The global cross-border e-commerce market generated US$230 billion in 2014, and is projected to grow to US$1 trillion by 2020, according to joint research by Accenture and AliResearch, Alibaba Group's research arm.

Nol van Fenema

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