Jade Cargo Halts Operations As Owners Negotiate
Jade Cargo has halted all flights as its owners Lufthansa Cargo and Shenzhen Airlines work on a plan to secure the Chinese air freight company's financial future.
A spokesman for Lufthansa Cargo said all six of Jade Cargo's aircraft have stopped flying, confirming earlier reports, and said negotiations were going on among shareholders.
Lufthansa Cargo's chief executive Karl Ulrich Garnadt told reporters this month that the company was reviewing its business in China, the world's second-biggest economy, where cargo companies are struggling to make a profit.
At the time, he said Lufthansa Cargo was in talks with the Bank of China and Shenzhen Airlines to agree a capital increase for undercapitalised Jade.
Jade Cargo no longer has the funds to buy fuel for its six Boeing 747 aircraft, German daily Boersen-Zeitung reported on Friday, citing no sources.
It quoted a letter sent to employees of Jade Cargo as saying the reason for the stoppage was a combination of weaker market demand and ongoing negotiations among shareholders. December wages would be paid as planned, the paper said.
A Jade Cargo customer service representative who declined to be named said no plane had left since Christmas and there would not be any flights before January 6.
She said Shanghai staff were on duty as usual but declined to provide any further details.
Lufthansa Cargo holds 25 percent of Jade Cargo and China's Shenzhen owns 51 percent. German development bank DEG holds the remaining 24 percent.
Jade Cargo does not publish details on its freight volumes and earnings.