GlobalAutoTV
Click to watch Dr. Juergen Weber -
Click to watch Dr. Juergen Weber -
euro resources


Need an office in Europe or Eastern Europe? Office suites, meeting rooms, virtual offices, network access




free downloads
EUROPE: "Russian M&A Overview 2016" report

EUROPE: "Russian M&A Overview 2016" report. 32-page report by KPMG Russia.

proceed to download
eJournals





back to index backEUROtalk February,  2017


Choo-Choo! New China-Europe Rail Link Set to Steal Air and Sea Freight Volumes

2017 will be the year that China-Europe rail services shift supply chain patterns.

As the first train from China rolled into London today, having left on new year’s day, the CEO of Kazakhstan’s dry inland port, Khorgos Gateway, told The Loadstar the services would eat into sea and air freight volumes.

We now have two trains per day, with about 80 teu and 41 containers per train,” explained Karl Gheysen. It runs three times a week to Duisberg, but we have also have services to the Netherlands, Madrid, Iran and now the UK.

The capacity is 540,000 teu a year, but we could make it a million.”

Khorgos Gateway was built by the Kazakhstan government where the rail gauge changes – making it a good point for transhipment. There are now some 10 rail lines from the gateway, opening almost limitless options around Europe, the CIS and Asia.

Forwarders are increasingly using the service, while DHL has plans to build warehouses for its customers at the dry port.

Its real advantage is 15 days’ transit over 45 days for sea freight,” said Mr Gheysen. And exports are starting – we have requests for backloads now.”

The service costs roughly twice as much as port-to-port sea freight, but about half the cost air.

Some estimates suggest the rail connection could take as much as 10% of sea freight volumes on the relevant tradelanes, but Mr Gheysen disputed this: it could take maybe 3-5%. That would be the maximum.”

Hewlett-Packard (HP) was one of the first shippers to use the service and now accounts for 30-40% of total capacity.

Mr Geysen explained that the rail advantage over sea was not just time.

It is cost-effective for some products, but not all. It’s more expensive than sea, but HP, for example, manufactures more than 1,000km from a seaport. If you add inventory costs during transport, and first and final mile, sea becomes less cheap, especially for higher-value goods. It’s the perfect middle ground. And there are different product groups that fit in that pitch.”

But, he warned: Air freight will be more affected than shipping.”

One analyst concurred. It does seem like a near-fatal threat to areas of the airfreight sector.”

Shippers now see the route as a viable alternative to air freight and air-sea freight into Dubai-Singapore-China, he added.

Meanwhile, postal services are increasingly taking notice of the rail services, while Alibaba is thought to be very interested”.

The service was hampered in its early days by extreme weather conditions in winter. My Gheysen revealed that Toyota had tested it for car transport, but found that the viscosity of brake fluid changed in sub-zero weather conditions. In response, the Kazakh government invested in more than 1,000 reefer containers, for both summer perishables and winter use.

The containers also have GPS monitoring, which reassures shippers with concerns over the security of the route.

There have also been concerns over lack of competition on the routes, with national railways offering services and a single company, UTLC, managing the rail tracks in the CIS region. Geodis and DB Schenker have been keen users of the service, but Mr Gheysen said: Anyone can organise their own train or book on one.”

He added that while some companies were starting to offer LCL services, this was not quite ready yet.

A single container booking is not very efficient,” he said. It’s all about block trains. Block trains have priority. Schedules are set, they have their slots. The frequency is there now. By 2020 it will be at full capacity.”

The Loadstar is fast becoming known at the highest levels of logistics and supply chain management as one of the best sources of influential analysis and commentary.

Source: The Loadstar - GAI





previous page

go top
search our site


Loading

EUROtalk

Other articles from the same issue (February,  2017).

Automotive Innovation Slovakia Survey 2016
play read on

Israel's automotive & smart mobility industry
play read on

This is how Brexit could impact the German car industry
play read on

Europe Top 20: motor vehicles produced per worker by country
play read on

WTO has ordered Russia to change duties on LCVs
play read on

Automotive Industry in Romania: A Path to Success
play read on

UK car output reaches 17-year high on export growth
play read on

European Carmakers Weigh Options Amid Mexico Tax Threats
play read on

Europe: an attractive market with complex supply chains
play read on

Eurozone growth and inflation confirm economic recovery
play read on

Will EU nationals be allowed to stay in UK after Brexit?
play read on

Eastern Europe’s workers are emigrating, but its pensioners are staying
play read on

Top priorities for European boards in 2017
play read on

EU inks deal to end roaming charges in June
play read on

EU Antitrust Continuity Potentially Threatened by Brexit
play read on

Choo-Choo! New China-Europe Rail Link Set to Steal Air and Sea Freight Volumes
play read on

We are hiring! The European manufacturing industry looks for STEM graduates
play read on

EU Agrees on Final Version of Prospectus Regulation; All EU Issuers can Expect to Benefit from the Employee Share Plan Exemption Starting in 2019
play read on

Russia Files WTO Suit to Protect Metallurgists
play read on

EU commission drops anti-corruption report
play read on

Germany: The Works Council’s right of co-determination regarding the Employer’s Facebook presence
play read on

Brexit White Paper: implications for employers
play read on

Poland: New tax super deduction for R&D in annual corporate tax returns for 2016
play read on

German Tax Monthly January/February 2017
play read on

EU labour cost index - recent trends (Dec. 16)
play read on

Survey shows Hungary’s healthcare near bottom in Europe
play read on

UK manufacturing kicks off 2017 on the right foot
play read on

How privacy consent might change with new European ePrivacy rules
play read on

Europe: Employer’s subsidiary liability for occupational pension payments
play read on

CEE outperforms rest of Europe (real estate)
play read on

Major European Manufacturing PMI data remains firmly in expansion territory
play read on


Our Free eJournals
GlobalAutoExperts

To visit GlobalAutoExperts Directory, click here.


©2008 GlobalAutoIndustry.com | HCI Group, Ltd.
101 West Big Beaver Road, Suite 1400 | Troy, MI 48084 USA
USA Tel: +1.248.687.1060 | USA Fax: +1.248.927.0347
Fax UK: +44.(0)845.127.4765 | Fax Europe: +31.20.524.1659 | Fax Asia: +852.3015.8120