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SINGAPORE TO CUT AIR FREIGHT RATES

SINGAPORE – A third air cargo ground handler will be appointed shortly at Singapore's Changi airport, in part as a way to reduce charges some clients say are too high, reports Air Cargo World. 

Minister for Transport Yeo Cheow Tong told an international aerospace meeting the move is part of a wider review of the cost structure at Changi, which some observers warn is coming under pressure as the leading regional hub.

"When the third ground handler starts operations next year, we will also restructure the franchise fees paid by the three ground handlers at Changi," Yeo said.

"This will cost the government about $5.8 million [US] a year. We would expect that the competitive environment will result in the ground handlers passing these savings back to their customers. We cannot force them, but I believe that with three ground handlers competing for the work...a large part of that will be passed to the airlines."

Uwe Doerken, chief executive of DHL Express, recently said that while it would like to expand operations, "handling costs here in Singapore are not competitive," the local Business Times reported. Yeo said talks are under way, and that other cargo companies found Changi "very, very competitive."

Yeo indicated that foreign companies have an inside track for the new handler franchise, although said the government wasn't barring any qualified applicant. The deal can be a joint venture or single-entity model, he said.

All Changi ground handling is now done by the Changi International Airport Services Pte. Ltd. unit of the Civil Aviation Authority of Singapore and Singapore Airlines subsidiary Singapore Airport Terminal Services Ltd.

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