A state of disorder has emerged in China's air-freight industry after five courier firms have had their licenses for air-freight services suspended within three weeks for breaking air-freight safety code.
Â
The China Air Transport Association, which represents China's airlines, suspended the air-freight license of Beijing Feilishi Express last Tuesday because the courier firm was found forging a stamp of China Southern Airlines to transport inflammable materials.
Â
Earlier, four Shanghai couriers, including Yunda and YTO, had their licenses suspended for a year because they failed to report inflammable materials, including two lithium batteries which are banned on board aircraft, in their cargo, causing a small fire on a China Southern flight after it landed.
Â
"All membership carriers of the association should refuse to transport cargo for the four couriers during the suspension," the association said.
Â
The modus operandi, or method of operation, of air-freight service industry in China includes subcontracting among courier firms, agents and airlines which facilitate the carriage of some forbidden materials on board aircraft, said Xu Yong, a chief analyst at Logistic News and Information.
Â
In reality, the courier firms pass the cargo to the shipping agents who then bargain with the airlines to get lower prices, said an official with a local courier firm who asked not to be named.
Â
"Since more than 70 percent of air-freight cargos in the country are actually undertaken by the agents, the punishment would have little impact on the courier firms," he added.
Â
Cargos can be carried by freight aircraft and in the cargo hold of passenger aircraft. China's civil aviation industry has flown 5.7 million ton-kilometers of cargos in 2011, which may climb by 15 percent this year, according to the China Traffic and Transportation Association.
Â
As China had only 91 cargo aircraft at the end of last year, courier companies and the agents also compete fiercely for space in the cargo holds of passenger aircraft.
Â
"Amid rapid growth of China's courier demands, the courier firms have to rely on the agents to book cargo space with the airlines," the courier official said.
Â
To solve the problem, a growing number of express companies are setting up their own freight jet fleet.
Â
Shanghai-based YTO Express seeks to invest 5.5 billion yuan (US$883 million) within 10 years to set up its own cargo aircraft fleet. The fleet announcement coincided with the suspension of the air-freight service licenses.
Â
"The punishment may slow our plan to set up the fleet as we have to overhaul the company first," said Lang Hongfei, vice president of YTO Express.
Â
The new freight aircraft company will be based in Xiaoshan International Airport in Hangzhou, east China's Zhejiang Province.
Â
YTO has leased two cargo aircraft, but land transport still accounts for 98 percent of its total services, according to Lang.
Â
STO Express, another Shanghai-based courier company, revealed that it plans to acquire an aviation company next year to establish a fleet of at least seven cargo aircraft.
Â
"We have seen the necessity to have our own aircraft," said Xiong Dahai, vice president of STO. Xiong said future air-freight services will account for 25 percent of the firm's business.
Â
Currently, SF Express and China Post's EMS, or Express Mail Service, own their own freight aircraft.