This January, a new freight train route was launched between Yiwu in the Zhejiang province of China and London. The idea for the new rail opening came about in order to reduce both the time and the cost of transporting goods between China and the UK.
Taking just 18 days for the whole journey, the goods train is being operated by the Yiwu Timex Industrial Investment Company who have already been looking after the operation of freight trains for a year that runs twice weekly between China and Spain, routed via Duisberg in Germany. The China-London service is due to run once a week during the preliminary trial period.
An important trade partnership
Onetwothree Logistics in London are the sole UK agents dealing with the service. Their manager, Oscar Lin, stated: ‘This cargo train service highlights important trade partnership between the UK and China post-Brexit.’
They will look after the UK side of the service, dealing with the UK customs procedures and distribution from the China export side and then sending UK exports on the return journey back to China. The company advised that the main barrier when it comes to creating the UK-China train route was networking with all of the many governments in the different countries along the way. They then had to put together the most practical route by choosing specific tracks.
Cross-border logistics competition
There has been a recent upsurge in competition from logistics companies to deal with cross-border logistics when it comes to China and Europe. Back in November 2015, STO Express from Shenzhen was the first delivery company in China to put in place their own purposeful batch of trucks and planes to take care of deliveries throughout Europe. Running cargo flights between Hong Kong and Prague three times a week, they will deliver goods to the whole of Europe, along with the UK. Their aim is to take a quarter of the Chinese market from larger companies such as UPS and DHL, with their fees being half of what these much larger global firms charge.
Imports from China increasing
Figures provided by the Chinese company iResearch indicate that the cross-border imports from China increased from 100 billion yuan back in 2014 to 150 billion in 2015 and was calculated to hit 210 billion in 2016.
Many people in the industry welcome the news. Brunel Project Cargo in the UK stated that the new freight line will change the way many shippers deal with their Chinese exports and imports due to the fast transit time; it will be particularly suitable for exporters who experience manufacturing delays and need to make up time during delivery. Compared to air and sea freight, rail freight is half the cost of the air service and takes half the time of transit by sea. SimplyDuty.com also said that anything that increase imports from China is good for the customs and excise industry operators.
The new service is planned to mainly deal with China-UK trade but the stops that it makes in France and Germany will help serve European trade at the same time.