News / Ecommerce player Great Vision signs $116m deal with Cargojet

© motortion |

Ecommerce fulfilment platform Great Vision has signed a three-year charter deal with Canada’s Cargojet.

The deal will give Great Vision, which has operations in China and Canada, services between Hangzhou and Vancouver on 767-300Fs, which began last month with three flights a week, but it could scale up.

Cargojet said the revenue from the deal was estimated at C$160m (US$116m) over the full term.

There is little public information about the China operations of Great Vision HK Express, but its Canadian website notes that, via its owned assets, plus partners (including Canada Post, FedEx, UPS and Purolator) providing services such as customs clearance and final-mile, it could support ecommerce players’ logistics requirements throughout Canada.

It says its customers are large manufacturers, forwarders and ecommerce platforms, with delivery direct to consumer.

“International air freight is a key part of this logistics chain, and we believe through this strategic partnership with Cargojet that we can offer extremely reliable and efficient services to our customers, while continuing to promote trade between the two countries,” said Christine Cheng, co-founder and COO at Great Vision HK.

Jamie Porteous, Cargojet’s co-CEO, said: “Leveraging Cargojet’s industry-leading record of on-time performance and reliability, together with the connection opportunities from Vancouver to 15 other cities in Canada, will allow Great Vision HK to provide enhanced services for China-based ecommerce service providers to their customers across Canada.”

The challenge for the parties will be filling the backhaul. Last year, to help Flexport increase its utilisation on the backhaul, it partnered with WestJet Cargo.

Neel Jones Shah, board adviser for Flexport, explained earlier this year: “It was mainly to allow WestJet to be able to sell Asia in a significant way to customers sitting in Halifax, the lobster producers and people like that. And so we had a nice little niche coming in, and they would fly their freighter into Chicago, and we’d sit on the ramp right next to each other.”

But those kinds of deals end when the economics change, he explained.

“Sometimes people will dump a lot of capacity into a market like that, and then all of a sudden the yields plummet. Interline arrangements don’t work when the yields get to too low. At times, the market just doesn’t allow the economics to add up, and so you have to pivot to something else.”

Ecommerce has come under the spotlight in recent weeks, following changes to US compliance that have seen a lot of cargo held by US Customs and Border Protection. Sources said they were looking at importing ecommerce via Canada instead, and then trucking over the border.

However, Canada could see a summer of logistics disruption, with strike threats both from border control officers and rail services.