US-listed international mixed-carrier FedEx Corp plans to launch air freight services to Cambodia by mid-2021, according to State Secretariat of Civil Aviation (SSCA) spokesman Sin Chansereyvutha.
The plan was unveiled at a meeting between Minister in charge of the State Secretariat of Civil Aviation (SSCA) Mao Havannall and US ambassador to Cambodia Patrick Murphy on February 11.
Chansereyvutha told The Post that the purpose of the meeting was to seek “special and urgent support” from SSCA and allow FedEx to fly and transport goods in and out of the Kingdom as soon as possible – with June posited as a target date.
“The process to meet the requirements of a formal permit for air cargo flights in and out of Cambodia is quite time-consuming,” he pointed out, noting that FedEx applied to SSCA for a landing flight permit for charter or non-scheduled flights.
“We’ve reviewed FedEx and support their petition for flights to Cambodia, but the company is missing some of the documents. Once they’ve filled everything out, we’ll work with them and smoothen their progress,” Chansereyvutha added.
Logistics Business Association (LOBA) president Chea Chandara told The Post on February 14 that FedEx’s entry into the Cambodian air transport market would trim air freight costs and alleviate the current shortage of cargo flights stemming from global Covid-19 restrictions.
“The company in question exclusively provides freight services and comes as we face a reduced offering of flights. I’d say this is some fine news and will provide an opportunity for the company at the outset if they can muster a freight service debut by the middle of this year,” he said.
Before Covid-19, air freight rates from Phnom Penh to the US generally ranged from $3.50-$3.80 per kilogramme, but ballooned to about $10 after the pandemic hit before receding to $5-$6 now, according to Chandara.
“I see this as an opportunity for FedEx to capture a market share in Cambodia, at a time when no newcomers are taking the leap to penetrate into the market. We need a more consistent number of flights per week,” he said.
Air cargo traffic through Cambodia’s three international airports dropped by 29.9 per cent last year compared to 2019, according to Khek Norinda, the communications and public relations director at Cambodia Airports, the joint venture company contracted to manage the Kingdom’s international airports.
On the New York Stock Exchange, FedEx’s (FDX) share price rose $8.64 or 3.40 per cent to close at $263.00 on February 12 for a market capitalisation of $69.71 billion, with 2.39 million shares traded.