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Growth is Steady yet Surgical at Mercury Air Cargo

Mercury Air Cargo continues to steadily grow by adding clients to its roster where it can strategically fit them in.

“We're a business that is changing on a weekly basis,” said Chief Operating Officer and Executive Vice President John Peery.  He said somedays tend to be quieter than others, and certain days of the week, they’re at capacity. “For us, it is a matter of finding business to fit in those slower periods,” Peery said.

In the 213 building at LAX, Mercury Air Cargo secured Hong Kong Air in December. The Hong Kong based carrier flies an A-350 between Hong Kong and Los Angeles daily.

They also secured Xiamen Air, who originally had flights from Xiamen three times a week, but they moved to daily flights in February. Peery was pleased to report that both Hong Kong Air and Xiamen have both been producing in excess of what we had anticipated

Peery attributes their success to the decision to remove the company from the Container Freight Station (CFS) business which is a very labor intensive business model, and replace that business with a carrier, EVA Air.

EVA Air has triple daily passenger flights to Taiwan and three freighters a week. Both of these, Peery said, would change the financial complexity and stability of the 216 building. The account was one that Mercury Air Cargo had handled previously for 20 years. EVA left for five years, and now have returned to Mercury.

These additional contracts in two of our cargo terminals will bring them closer to capacity, and yet Mercury Air Cargo still managed to secure one more contract: Interjet.  The Mexico City-based carrier is a narrow body aircraft (i.e. an aircraft that does not have containers on board, where everything is loose-loaded, like baggage), with nine services a day between Los Angeles and several resort locations in Mexico, including Guadalajara and Mexico City. Interjet as well as Volaris will be serviced for our Avion facility, Peery said.

An ongoing challenge with the Los Angeles airport is its limited facilities for cargo. According to Peery, despite LAX being the number one origin destination in the world for passenger travel, and the fifth largest in the world for cargo, the airport is only 3,500 acres. To put in perspective, the Dallas Fort Worth airport is 18,000 acres, he said.

And while $14 billion have been allocated to the improvement of the passenger side at LAX, no funds have been dedicated to improving cargo, Peery said. Aware of these challenges, the airport is in the process of screening candidates to expand the cargo side of things. Mercury Air Cargo has joined hands with a large construction firm to submit a proposal, but Peery warns that the process to improve and increase cargo space and facilities at LAX will be a long haul before any actual construction begins.

“Even if the RFP [Request for Proposals] came out in the next couple of months, I don’t think a spade will go into the dirt for another two years, maybe three,” he said.

 

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