Taiwan Today

With high-technology product export orders up ahead of the pre-Christmas rush, Taiwan’s top two air carriers have experienced a steep increase in cargo revenue recently. China Airlines Ltd.’s revenue from its cargo shipping services hit a monthly record high of NT$5.9 billion (US$ 18.3 million) for November. The carrier’s total revenue for the month was NT$11 billion, the highest level since September 2008. Meanwhile, Eva Airways Corp.’s cargo revenue for November reached NT$7.4 billion, marking the best performance over the past year. Airline industry sources said that with retailers rushing to stock store shelves with high-tech products, such as cell phones and computers, before the year-end holiday season, cargo transport services have been stretched to the limit. This has resulted in a continual rise in air shipping prices. Since September, prices on various routes, including those to the United States and Europe, have increased by as much as 30 percent, the sources said. With shipping demand set to continue through the end of this year, the outlook for airline stocks in the fourth quarter is positive as carriers can expect sustained strong profits from their cargo services for the period. CAL executives said that although the volume of cargo that the carrier transports from mainland China to the United States and Europe is relatively low, the profits are high. Compared with shipping prices of between US$3 and US$5 per package on trans-Pacific routes to the U.S. west coast, prices on routes from the mainland in November were as high as US$5-US$6 per package, they noted. CAL’s revenue from passenger services on its mainland China routes account for about 13 percent of its overall turnover, but its revenue from cargo services on the same routes stands at 7 percent. The latter ratio is expected to increase as the fourth quarter is traditionally the high season for airlines’ cargo services. According to industry sources, each airline placed many of their cargo planes in storage last year because of a drop in shipping volume in the wake of the global financial tsunami. However, CAL has already brought two of its planes out of storage in anticipation of an upswing in business in the months ahead. (SB)