Firm controlled by JD.com founder Richard Liu obtain approval to set up a cargo...

Firm controlled by JD.com founder Richard Liu obtain approval to set up a cargo airline

Firm controlled by JD.com founder Richard Liu obtain approval to set up a cargo airline

21 hours ago

Chinese e-commerce giant JD.com, owned by billionaire Richard Liu Qiangdong, has been granted approval to set up a new cargo airline based in the eastern province of Jiangsu.

Detail:

Jiangsu JIngdong Cargo Airlines, with registered capital of 600 million yuan, has obtained preliminary regulatory approvals to commence operation, the Civil Aviation Administration of China (CAAC) said in a statement.

Suqian Jindong Zhanrui Enterprise Management, controlled by the JD.com founder Richard Liu, will invest CNY450 million to own 75% in the airline, while Nantong Airport group will contribute CNY150 million to own remaining stakes in the joint venture.

The airline is planning to use Boeing 737-800 plane for its fleet, the CAAC added.

The new airline will be based at Xingdong International Airport in the city of Nantong of China’s Jingsu province, where is also the home province of JD.com founder Richard Liu.

Context:

JD Logistics, the logistic arm of JD.com that raised HKD 24.6 billion in a Hong Kong IPO in May, hasn’t revealed the investment plan for the airline.

As of June, the air delivery services of JD Logistics cover 300 cities with 100,000 air routes throughout China, all through various partnerships with the country’s small airlines, including Zhejiang Loong Airlines and Zhongyuan Longhao Airlines.

Alibaba Group Holdings, JD’s biggest rival in e-commerce, has already expanding its cargo fleet of YTO Cargo Airline, which is operated by YTO Express. Alibaba owns 12% stake of YTO Express.

Shenzhen-based SF Holding, which operates SF Express, is building a new air cargo hub in the central province of Hubei.

 The company hopes the CNY2.3 billion project can rival FedEx’s Memphis base.

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