Emirates SkyCargo Finds Success in a Burgeoning Cambodian Market
There has long been rivalry amongst the countries in Southeast Asia, with both external and internal market forces driving one or more of the countries ahead of the others. Currently, Cambodia boasts one of the fastest growing economies in ASEAN and the world, making it an attractive emerging tiger economy to watch. The country offers a number of advantages for companies looking to invest, and many are beginning to take note.
Emirates SkyCargo has never been one to shy away from a challenge, and were ahead of the curve by taking the initiative last year to begin weekly freighter service to Phnom Penh. The capital city contributes largely to the country’s economic output, and the freighter service was a promising sign of the confidence Emirates SkyCargo saw in the emerging market.
Most recently, Emirates commenced operating daily linked service from Dubai to Phnom Penh, via Yangon in Myanmar. This new service is operated with a Boeing 777 aircraft and broadens the airline’s network in Southeast Asia to 13 cities. The addition of available daily belly space gives more options for manufactures, shippers and forwarders in Cambodia, and strengthens Emirates offering by augmenting their service to better suit the needs of the market.
With their firmly established presence, Emirates SkyCargo has already begun to see the benefits with successful results, as they reported shortly after officially opening their new station in Cambodia a few short weeks ago. However, taking a look behind the scenes of these accomplishments reveals a substantial amount of dedicated research that’s done before the wheels even touch the ground. Emirates SkyCargo is famous for the multitude of destinations they service through their hub in Dubai, and they don’t just call on the largest of cities, they have put a focus on underserved secondary and tertiary areas where opportunities exist waiting to be unearthed.
Opening these new stations is no easy feat, but as Mr. Ravishankar Mirle – Emirates VP Cargo Commercial Operations – Far East & Australasia explains, it can be extremely rewarding. He said, “Before we actually embark on a project to serve a new market we do a lot of due diligence, with studies on the financial aspects and infrastructure of the market. Once we decide that we are entering a new market we work very closely with the local authorities there. It’s very important that at a local level we have all the various stakeholders involved. However, once all the planning is done and the first flights land in country, it’s a great feeling knowing we’re connecting another country with the rest of the world through our global network.”
For Cambodia specifically, the garment industry is large cog in the engine that drives the economy and is a top export for the country. Historically, much of these products tended to go by ocean, but the rising influence of the country is giving way to more high-end fashion production entering the country. It is here where shipping by air offers a huge advantage. With time sensitive seasonal products, events, and other rapid changes; speed to market is critically important.
Another segment that is seeing explosive growth is the perishables market. Cambodia has many high-value agricultural products, such as nuts and fruits and has potential for exports to new markets. This is an area that Emirates SkyCargo excels in with their Emirates Fresh cool chain solutions. The transportation of perishable goods can be fraught with challenges and complications that can easily spoil products before the reach their destination. Emirates SkyCargo has developed solutions for all types of perishable goods, and has invested heavily with an ultra-modern hub in Dubai that is one of the largest and most technological advanced cargo handling facilities in the world. This facility helps to ensure the cool chain remains unbroken and that sensitive perishables exported from Cambodia, and from around the world, are kept in optimal conditions throughout their journey.
Mr. Mirle said, “Another area that may be thought of less, but is still important, is the import of the raw material that has to come into the country for manufacturing and the machinery that’s being imported to sustain infrastructure in country. This is a critical part of the equation and is an area that is often overlooked. We’ve found there’s a good balance of loads, with raw materials coming in and being processed as finished products that are then exported.”
For Southeast Asia countries, being so closely linked with each other fosters a competitive attitude that is raising the competitiveness of the region as a whole. This competitiveness is part of the current that continues to drive the dynamo of growth. This however doesn’t mean that they don’t see benefit in trading with each other, as the amount of cross border and intra-Asia trade is continuing to grow. Mr. Mirle sees this inter-Asia trade as a key part to their success moving forward, as this establishes a base of trade that gives them level footing for which expansion outward is possible; ultimately giving them the ability to create new markets and segments.
This also means that Emirates SkyCargo can leverage their advantage of being in so many different locations throughout Southeast Asia. For instance, cargo that is urgent or premium can go directly out of Phnom Penh on the daily Boeing 777 flights. However, because of the large market in a neighbor like Bangkok where there are even more flights and capacity, rates may be a little lower. For shipments where more time is allowed, cargo can be trucked and shipped out of there. This provides two different speeds and price points, and ultimately gives the customer more choices.
“Some cargo will still be carried overland to other airports that we serve, but our intention is not to pull cargo out of those airports,” said Mr. Mirle. “I don’t think that it’s possible. There’s a lot of capacity available already on those markets. What we’re seeing is that if your total transit time and KPI’s are banking on time and speed to market, I think our service is unbeatable.”
He continued, “Since we’ve began offering service to Cambodia, the statistics have shown great organic growth, and I expect these numbers will continue to rise. We’ve been in close contact with customers, and there’s a lot of excitement in the market. The success of our initial flights bodes very well for this market. It’s become evidently clear that it’s important to start investing into these emerging markets to help them grow, with the end goal of achieving mutual success.”