Cargolux (CV, Luxembourg) is expected to finalize a shareholders' agreement concerning the proposed establishment of Cargolux China (Zhengzhou) during a board meeting later next week.
Following his return from an official visit to China, Luxembourg's Minister for Sustainable Development and Infrastructure, François Bausch, told the Wort newspaper that Cargolux would hold a 35% stake in the carrier with the remainder to be held by Zhengzhou-based Henan Civil Aviation Development & Investment Company (HNCA).
He said that while initially Cargolux was to have held a 25% stake at most, HNCA subsequently requested the Luxembourg-based freight specialist absorb a further 10% after a suitable third investor could not be found.
As it stands, of the approximately USD75 million Cargolux will contribute to the carrier's establishment, USD25 million will be in the form of a direct cash injection while the remaining USD50 million will come in the form of loans.
In October last year, Cargolux CEO Dirk Reich said he expected Cargolux China to operate its maiden commercial flights in early 2017. The start-up is considering leased as well as second-hand aircraft - B747-400(F)s in particular - for its initial capacity requirements though the B747-8(F) has also been mentioned as a longterm option. According to AirCargoNews, operations will focus on the transpacific, with up to 80% of the flights between the US and China, while the remainder will be intra-Asia rotations. There will not be any China domestic flights, the Cargolux boss added.
Given the soft Asian market, Cargolux chairman Paul Helminger has said he expects the start-up to incur losses of less than USD50 million in its first three years of operation, supported by subsidies from the Henan Province Government.
