FedEx rolls out China-based next-business-day domestic parcel express service

By Jeff Berman, Senior Editor -- Logistics Management, 3/20/2007

HANGZHOU, China—FedEx said today it will introduce next-business-day domestic express service in China, beginning on May 28.

The company said this service will function as a part of its international express service and will connect businesses within China and throughout the world, adding that FedEx currently connects more than 90 percent of China’s GDP internationally through its global network.

A FedEx spokeswoman told Logistics Management a major driver for this service was that up to 90 percent of its international customers have expressed interest in domestic freight forwarding services.

“The potential of our domestic-only customer base is enormous, and growing,” said the spokeswoman. “[Shippers] will benefit from a comprehensive reliable service offering to, from and within China—all under the trusted FedEx brand with custodial control.”

Through this air network, FedEx is offering next-business-day domestic express service to 19 cities in China, and time-definite service to more than 200 cities.

The next-business-day domestic express service will include a hub-and-spoke system at the Hangzhou Xiaoshan International Airport in the Zhejiang Province of East China. This hub, according to the company, will have the ability to sort up to 9,000 packages per hour.

Other benefits of the domestic hub-and-spoke system, cited by the spokeswoman, include: reliable, time-definite service with real-time track and trace (for key services); availability of service over a wide, and growing, geographic area within China; a national air network that will allow next-business-day service to 19 cities and day-definite service to more than 200 cities; a national ground network including facilities, vehicles, operating equipment, IT systems and equipment, employees and customer database; and a money-back guarantee.

FedEx said in a press release that Okay Airways, a China-based domestic air carrier, will provide the domestic air transportation with three . Boeing 737 freighters. And Okay Airways will operate an air cargo domestic network within China in support of FedEx. Its aircraft will operate two circular routes nightly, covering the country's major airports.

The spokeswoman declined to comment on how many customers FedEx expects to use the new service