2024 is expected to be more positive for cross-border logistics in general, given a renewed pick-up in trade and consumer demand. Air cargo has posted its fourth month of double-digit growth in March, according to IATA. So the industry is already seeing a strong first quarter. An uptick in global and regional demand is translating well for cargo and the e-commerce delivery sector.
Data shows China is now exporting more to Southeast Asia than to the US. In 2023, the total export value from China to SEA in 2023 was US$523.7 billion. The industry can expect to see this economic trend continue, which presents a big opportunity for logistic players in the region.
Furthermore, key e-commerce lanes between China and the top five Southeast Asia countries are expected to grow to US$3.8 billion in freight value in 2025. This is, therefore, an opportune moment for airlines and logistics players to create more capacity to be able to cater to the incoming e-commerce volume, especially from China to Southeast Asia.
“For Teleport, China is a key focus market over the next five years as we seek to ramp up our capacity by creating more key high-volume lanes,” Jagedeswaran Nadrajah, Head of Air Partners, stated.
“Our Air Partners programme is a win-win solution for both Teleport and our partners in terms of us respectively growing our network and capacity by maximising the utilisation of existing assets in the sky.
“Budget carriers are the dominant airline model in Southeast Asia, and their cargo capacity is only 30 percent utilised, on average. This means most planes in the air are flying ‘empty’ in their cargo hold to most destinations within the region today.
“It is a model that allows our partners to combine their network with our largest Southeast Asia air network, in turn mutually benefitting towards growing our respective reach and capacity by air. Furthermore, our air partners get to maintain a lean organisation with consolidated resources, while growing their cargo revenue.
Growth strategy
For the first quarter 2024, Teleport delivered 63,945 tonnes during the quarter, a 79 percent increase from the same quarter in 2023. Utilisation rate rose 5 percent YoY to 16 percent during the quarter, even though capacity rose 25 percent.
The carrier delivered over 15.6 million parcels in Q1 2024, a 175 percent improvement from the same quarter in 2023, and also achieved a new average of 172,000 daily deliveries.
“We remain focused on our key three strategies this year, which is anchored on growing our network, capacity and end-to-end operations to strengthen our next-day proposition in Southeast Asia,” Nadrajah explained.
“Growing our Air Partners network with more strategic partner airlines, so we don’t fly empty. We have over 40 partners to date, and more are coming soon. We’ve recently inducted VietJet Air Cargo, and Pakistan International Airlines into our partners programme.
“Extending and strengthening our end-to-end operational capabilities with a multi-modal, first-to-last-mile capabilities in key markets – to enable us to better deliver reliable, affordable, next-day cross-border logistics solutions in Southeast Asia.
“We are also developing a pioneering next-day e-commerce solution between China and Southeast Asia, where Teleport can help businesses in China as the first point of contact for their e-commerce volumes moving into Southeast Asia.
“We continue to seek new avenues to grow our core network beyond AirAsia.”
