Taiwan and South Korea, both strong in high-tech industries, saw their exports increase by 29.4% and 25.8% annually respectively in 2021. Korean Airlines, China Airlines, and EVA Air led the recovery in 2021 by becoming the world’s three most profitable airlines with up to 95% of cargo revenue. With the wave of globalization that began in the 1970s, East Asian countries with long experience in efficiency and high education levels have become an indispensable link in the global supply chain.
In addition, Japan, South Korea and Taiwan in East Asia are “island terrains” and China’s production bases are mainly located in coastal areas, making Hong Kong, Shanghai, Incheon, Narita and Taoyuan airports the world’s busiest cargo airports. The top-five air cargo airports in the world are all in East Asia, ranked in descending order: Hong Kong, Incheon (South Korea), Pudong (Shanghai), Taoyuan (Taiwan) and Narita (Japan).
The cargo volume of Taoyuan Airport had increased from 2.27 million metric tons in 2017 to 2.79 million metric tons in 2021, with double-digit growth in exports, imports, and re-exports, and the revenue and profits of Taiwan airlines have risen in tandem with Taoyuan Airport’s cargo volume data. In 2021, CAL’s profit reached NT$9.3 billion, and EVA Air’s was NT$6.6 billion. However, KAL’s revenue is equivalent to NT$15.55 billion.
Korean Air and China Airlines have very similar fleet structures, but why is Korean Air more profitable? The key is that KAL has already merged with Asiana Airlines, and the whole South Korean market is dominated by one single airline; and secondly, Korea is close to the Arctic Circle, so it has more advantages than Taiwan in flying to the US and Europe. In the future, if the production hub is transferred to ASEAN and South Asia, then the geographical location will be a major selling point for Taiwan.
In terms of cargo, the global air cargo volume in 2021 was 19% higher than in 2020, and 7.3% higher than in 2019…