World Eye Reports on HONG KONG











©THE JAPAN TIMES
Thursday, July 27, 2000
B5

EXPRESS CARGO TRANSPORT

An air of sophistication

A generation ago, shipments of paper documents propelled the air-express industry. Trace and track capabilities were limited and online bookings an unknown concept. Today, the airexpress industry is redefining itself. It has become a sophisticated business, achieving optimal customer satisfaction through the rapid developments in information technology.

"Air express is a one stop shop taking shipments door to door. When customers pay a premium price they expect premium service. And that means speed, reliability and advanced information


HONG KONG


technology. Customers want to know where their shipments are as they move around the world and this can be achieved via online tracking and tracing," explained Charles Longley, chief executive of DHL Worldwide Express Asia Pacific and Middle East


Charles Longley, CEO for DHL Worldwide Express, Asia Pacific and Middle East

Prior to the Internet age, DHL would install a PC in the customer's office for the purpose of arranging parcel pick up and deliveries. "Now, the customer can access the Internet and book a pick up online. The courier is notified electronically, eliminating potential errors and improving the efficiency and effectiveness of our service," explained Longley.

The global air-express industry is again achieving buoyant growth after a slowdown during the Asian economic crisis. In the next five years, the industry is expected to grow by 18 percent annually. According to Longley this growth can be attributed to two key factors that have extended the industry beyond its traditional role. The first is the trend for manufacturers to reduce inventory costs; and the second, the exponential growth of e-commerce.


"A top priority for manufacturers today is to reduce the costs associated with inventory management. The way to do this is to ship daily by air. Our business, therefore, comes from manufacturers shipping fewer and smaller packages more frequently," commented Longley.

Hailed as an essential part of the e-commerce equation, air-express companies have assumed the role of integrated logistics solutions provider. E-commerce has revolutionized traditional business practices by directly linking suppliers with end-users. And with that, delivery time has become a crucial factor for any Web-based business. Enter DHL, a company who has become the critical support network behind the frontline.

DHL is moving HongKong.....

.....transporting international cargo.....

"As new technology emerges product lifecycles shorten, global companies are created and the world becomes one large market place. However, companies still need to get their products to the end user. And the air-express industry is well-aligned to do that," said Longley.

Earlier this year DHL established its Central Asian Hub in Hong Kong to further support the growing demand for express services in the region. The company has also teamed

.....and bringing businesses closer to their markets.
up with Hong Kong's official airline, Cathay Pacific to provide 32 overnight cargo and passenger flights to Osaka, Seoul, Taipei and Singapore."We believe that our partnership with Cathay Pacific will further leverage Hong Kong's position as the premier cargo hub in Asia," said Longley.

In addition to the central Asian hub, Hong Kong is also home to DHL's eighth Express Logistics Center (ELC), with the others strategically located in Singapore, Brisbane, Bahrain, Panama, Johannesburg, Miami and Brussels. Using a state-of-the-art inventory-management system and online computer technology, DHL can provide customized logistics solutions for a variety of businesses. According to Longley, outsourcing a company's inventory management to DHL reduces the investment required to enter new markets

"We are well-positioned to service the needs of those who use the Internet, not just in shipping but also strategic inventory management. The brain is going to be used less and less as we go forward," stated Longley.

DHL Worldwide Express currently maintains 40-percent share of international express traffic. The company links more than 85,000 destinations in 228 countries and territories around the world


The gateway to China

Kintetsu World Express knew back in 1969 that Hong Kong was a strategically important location for a regional headquarters. As the first overseas subsidiary for one of Japan's largest transport conglomerates, KWE Hong Kong has played a central role in its parent company's Asian operations.

"Hong Kong is the most appropriate place for a regional headquarters as it is the gateway to China," explained Yoichi Tanaka, managing director for KWE Hong Kong Ltd. "Not only is Hong Kong in the geographic center of Asia but it also has an excellent transportation infrastructure and fully developed logistics system,"




Yoichi Tanaka, managing director of Kintetsu World Express

With its international transport network covering 165 cities in 21 countries, KWE has the globe covered. The company has traditionally specialised in air, sea and land transportation , but like DHL Worldwide Express it is shifting towards providing logistics solutions. Tanaka believes that enormous potential exists in this area particularly in the southern China.

"Hong Kong and southern China are becoming increasingly integrated. Many companies have established manufacturing facilities in southern China which results in greater volumes of cargo being imported and exported," explained Tanaka. KWE Hong Kong is also responsible for the company's operations in Shenzen, southern China. KWE (Shenzen) Co. was set up in 1996 to meet the increasing need for cargo capacity in the region.

"We are very optimistic about the future of our industry in Hong Kong and southern China. Hong Kong's Chief Executive Tung Chee Hwa is striving to position Hong Kong as an international cargo center and that reflects a certain confidence in the region's potential," Tanaka explained.

While KWE Hong Kong will continue to prosper in the Chinese market, Tanaka believes that the company's worldwide operations will integrate to serve a "borderless" world. "The world is getting increasingly smaller and I am sure that one day the Kintetsu Group will become KWE United Nations!" Tanaka mused.

Gearless drive and robotic handling

In the world of high-rise Hong Kong, the value of the lift is not to be underestimated. Fortunately, rapid developments in elevator technology have ensured an efficient means of reaching great heights, not to mention saving legwork. Elevators in the city's newest buildings can catapult themselves to the 78th floor in seconds, and the passengers do not feel a thing. But what about Hong Kong's older high-rise buildings? Stepping into their postwar elevators can be a disconcerting task. In recognizing this as a potential public safety hazard, the Hong Kong government has introduced an initiative to improve elevator safety standards in buildings 30 years or older.

"Due to an increased number of lift accidents, the Hong Kong government is insisting that owners of older buildings renew faulty or unsafe lifts," explained Frances Lau, managing director of Nikko Lift & Escalator Services Ltd. It is estimated that Hong Kong currently has 8,000 elevators that fall under the elevator maintenance mandate. For Nikko, this means big opportunities to garner contracts. "We hope to gain 20 percent of this market in the next five years," said Lau.

Established in Hong Kong in 1981, Nikko Lift & Escalator Services is a specialist in the import, installation and maintenance of elevators and other mechanical transportation systems. The company is the sole agent for the Japanese elevator brand, Nikko, promoting its products throughout the Hong Kong, Macau and mainland China markets.

According to Lau, increased competition from the industry's major players has compelled Nikko to carve out its niche in its three geographic markets. "We try to avoid competing with the larger lift companies. We like to define ourselves as lift modification specialists offering the very best in service and parts," explained Lau. Nikko's ability to customize elevators and replace specific parts is considered an advantage as Lau noted, "Most large companies will not agree to modification jobs unless the whole system is changed."

With a strong emphasis on quality, high technology, energy efficiency and environmental awareness, Nikko works with several European companies to tap into the latest in lift technology. Since 1997 Nikko has worked closely with Austria's ATB Group, and in 1999, it introduced ATB's gearless motor to the Hong Kong market. Lau explained that this is the most technologically advanced solution for elevators requirements. It reduces energy consumption by 50 percent, shortens the installation period and enhances the utility of the elevators in general. Currently Nikko is only one of two companies with gearless motor technology in Hong Kong.

Nikko's innovative solutions aim to solve car parking space woes.

With a tight reign on the Hong Kong market, Nikko is setting sights on the residential high rises across the border. Improved living conditions have fueled a demand for elevators as the more discerning residents refuse to walk up flights of stairs. "Our major focus for the mainland will be to promote ATB's gearless motor and Nikko lifts to hotels and low-rise buildings in southern China," Lau said.

In addition to its elevator business, Nikko is an expert in car- parking technology, know-how considered invaluable in a cramped city like Hong Kong. Facing increasing land-shortage problems and expensive property, Hong Kong is in desperate need of a car parking solution, one that Lau believes Nikko can offer. "We are set to revolutionize car parking in Hong Kong with our automatic parking technology," Lau proclaimed. Developed in Japan, the technology involves a large robotic arm that handles and stacks the parked cars.




YKK Hong Kong LTD.
KWE Kintetsu World Express
DHL Worldwide Express
www.asiansources.com/ykk.co
kwehkg.com.hk
www.dhl.com




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