MASkargo in US$30 million upgrade to hit 7pc growth in 2010

MALAYSIAN Airlines Cargo (MASkargo) plans to upgrade its warehouse material-handling cargo system at a cost of MYR100 million (US$29.8 million) amid expectations that demand will pick up in the air cargo industry.

The upgrade is expected to take four years to complete. The work is scheduled to commence in the middle of this year.

"This is to mitigate the risk of technology obsolescence and hardware scarcity. The move will sustain our system capabilities for another 10 years," MASKargo managing director Shahari Sulaiman told the Malaysia Star.

"This also supports our aim to increase annual handling capabilities from the current 650,000 tonnes to a million tonnes," he said.

His comments came after the company announced its growth expectations for 2010. Mr Shahari said air cargo demand is forecast to grow by seven per cent this year to 37.7 million tonnes.

"This is stronger than the five per cent forecast last September. Air cargo demand contracted by 13 per cent in 2009 year-on-year," he said.

"Once the inventory cycle completes, growth is expected to fall back in line with the world trade volume."

According to Mr Shahari, MASkargo saw demand pick up during the fourth quarter of last year, mainly driven by demand out of China.

"MASkargo managed to benefit from the upturn for this period (fourth quarter) with increases in revenue, load factor and yields compared with the previous three quarters," he said.

(Source: www.schednet.com)