Hong Kong Air Cargo Terminals Ltd. (Hactl), the largest air freight handling company at the world’s busiest freight airport, is determined not to start a price war in response to a huge rise in capacity. Instead, the company is aiming at differentiating itself by service standards, though that may not be easy. A powerful combination of factors has made the Hong Kong market ripe for a price war: there are now three competitors; each has high fixed costs; capacity is far above demand; and ...

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