Wednesday, May 02, 2007

All Nippon to outsource cargo to ABX Air

ABX AirIn order to expand its capacity All Nippon Airways (ANA), Japan's largest domestic airline, will outsource some air cargo flights within Asia to ABX Air Inc. The deal marks the first such agreement between a Japanese air cargo carrier and an overseas airline on outsourcing flight and crew operations.

Beginning on May 15, 2007 ABX will operate 22 round-trip flights a week for ANA, according to a Bloomberg News item about the new agreement. ABX Air will fly two B767-200 aircraft for All Nippon in the Asian market, including Japan, China and Thailand. Reuters reports that most of the flights will be between Kansai International Airport in Osaka and a handful of major cities including Beijing, Bangkok and Hong Kong.

An article on MSN Money quotes ABX president and CEO Joe Hete, who said, "The Asian economy is the fastest-growing market in the world, and this agreement underscores ABX's commitment to grow its presence as an international provider of aircraft and aircraft-related services."

ABX has been trying to broaden its business beyond serving its major client, DHL, which accounted for 98% of ABX sales in 2005. The new deal with ANA is expected to generate about $22 million a year for ABX.

According to a Business Wire release, the agreement is for an initial period of two years, with an option for annual renewals thereafter. This is the first time the Japanese Civil Aviation Bureau (JCAB) has approved a foreign carrier to conduct cargo aircraft operations on behalf of a Japanese airline.

[Photo Source]