Sunday, February 08, 2009

FedEx moves its Asia-Pacific hub to China

FedEx moves its Asia-Pacific hub to China
Updated: 2009-02-07 15:36

The United States-based logistics giant Federal Express (FedEx) is closing down its Asia-Pacific airtrans-shipment hub in the northern Philippines and moving it to China's southern city of Guangzhou, media reports said on Saturday.

The last flight, heading for China's Taiwan, left Subic Bay on Friday just before dawn, the Philippine Daily Inquirer reported. Subic Bay, a former United States Navy base, is about 100 kilometers northwest of Manila.

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It will take the company a few months to pull out all its operations from Subic, according to Armand Arreza, administrator of the Subic Bay Metropolitan Authority.

"It may take them until May to completely move their operations to China," Arreza was quoted.

"The market in China is bigger than the entire market of Southeast Asia. China also gave FedEx rights to handle its domestic cargo, which is huge," he added.

Subic became the regional hub of FedEx's Asia-Pacific operations in 1995 after the closure of the US naval base in 1992. The authority collects around 150 million pesos ($3.2 million) annually from the company for landing, parking and warehousing.

About 500 workers would lose their jobs after the closure of the hub.

The company announced the transfer as early as in July 2005, expecting to open the new hub at Guangzhou Baiyun International Airport by the end of 2008. Later, it pushed back the opening to the first half of this year to provide FedEx with "the necessary time to fully test all systems and processes, as well as work closely with the Guangzhou authorities to ensure all necessary approvals are in place."

According to its company profile, FedEx provides services for more than 3.3 million packages daily to over 220 countries and regions. It has a workforce of more than 140,000 employees worldwide.