TNT opens Asian cargo hub in Manila

E. P. Patanne

TNT is looking to increase its equity stake in Pacific East Asia Cargo Airlines.

TNT Express Worldwide (TNT) has opened its Manila Air Hub at Ninoy Aquino International Airport's (NAIA) new cargo centre.

The facility occupies 4,500 square metres of warehouse and office space for imports, operations and Customs bureau. Pacific East Asia Cargo Airlines (PEAC), TNT's partner airline in the Philippines is also located in the cargo centre.

Manila Air Hub has a throughput capacity of 65 tonnes a day.

"Our Manila hub will play an instrumental role in enabling TNT Express Worldwide to capitalise on the strong economic growth forecast for Asia," TNT senior vice-president, Jean Claude Noel, said at the inauguration.

"This significant investment by TNT in the Philippines is necessary to further support the rapid growth of the Philippines economy," TNT CEO, John Fellows, said. "With the hub in place, we will be able to cut down on handling time substantially which, at the end of the day, will mean quicker response times, later collections for export consignments and earlier deliveries in the morning."

The facility will have an immediate impact on all the forwarding, industrial and commercial companies in the fast-developing provinces of Cavite and Laguna, south of Manila, he said.

"These customers could quite feasibly bring in their freight to the hub as late as 02:00 for Asian destination processing and get out on a flight that same morning," Fellows said.

It is the latest of the company's major investments in Asia and TNT plans to open five more branches in China this year, following the opening of four branches in Qingdao, Nanjing, Hangzhou and Guangzhou.

A new depot was recently opened in Ipoh, Malaysia and another two branches are planned to open within the year in Indonesia. TNT has just opened a larger airport office in Bangkok and there are plans to expand operations in Vietnam, where it is the first air express distribution company permitted to operate.

In other news, TNT is looking to increase its stake in Manila-based PEAC. This could be realised after PEAC is privatised, PEAC managing director, Benjamin Solis, said. The regional cargo airline is a joint venture that was 80 per cent held by state-owned Philippine Aerospace Development Corp (PADC). PADC recently put its share up for tender with Filchart Airways' US$4.2 million bid surfacing as the winner. Filchart Airways is owned by a Filipino-Chinese consortium.

According to the bid's parameters, TNT-PEAC is entitled to double its equity share as part of its right as an existing shareholder, Solis said. Another 15 per cent of equity will be sold to small investors or to the firm's employees. The increase of PEAC's stake to 40 per cent is the maximum allowed for foreign investment in this sector.

TNT is prepared to increase its ownership in PEAC to 40 from 20 per cent, Fellows, said. This is even though the airline, designated the Philippines' only flag carrier for international cargo services, remains in the red. Solis claimed that PEAC's financial situation is normal for this line of business, adding that by next year "we expect to reach a break-even point".