Alibaba Group Holding Ltd.'s logistics arm Cainiao Network said June 6 that it is leading a joint venture that will invest about US$1.5 billion to set up a digital logistics center in Hong Kong.
Cainiao has a 51% stake in the JV, while China Aviation Corp. (Group) Ltd. holds 35% and Chinese courier and logistics company YTO Express Group Co. Ltd. has 14%.
The 380,000-square-meter facility planned for Hong Kong International Airport is scheduled to open in 2023. It will include an air cargo processing center, sorting center and order fulfillment center and will be capable of handling tens of millions of packages per year. The facility will also be equipped with automated warehousing and temperature-control technologies.
The logistics center is expected to add approximately 1.7 million tons of cargo volume to the airport once it is operating at full capacity.
"The Hong Kong International Airport has been the world's busiest cargo airport for many years. As an important gateway for global goods to enter the mainland China market and vice versa, Hong Kong is of strategic importance to Cainiao," Wan Lin, president of Cainiao, said in a statement.
The move is part of Alibaba's commitment to invest more than 100 billion Chinese yuan into building a global logistics network that blends technology and efficiency, as it aims to eventually make deliveries within 24 hours in China and 72 hours around the world.
The new Hong Kong hub will be in addition to the five global hubs that Cainiao has planned in Dubai; Kuala Lumpur; Moscow; Hangzhou, China; and Liège, Belgium. The company already has three global fulfillment centers in Hong Kong.
Cainiao also launched an air freight route between Hong Kong and Belgium in May, its second such international transport operation for e-commerce orders following one from Hangzhou to Moscow that started earlier this year.
As of June 5, US$1 was equivalent to 6.41 Chinese yuan.
