Japanese logistics company Nippon Express plans to launch regular freight trains between Chinese and European cities early next year, the Nikkei Asian Review reported. The rail services will commence in February 2019.
Nippon Express plans to run entire cargo trains between Chinese inland cities, such as Wuhan, Chongqing and Xian, and inland European cities, possibly Duisburg in Germany. The report noted that
although the cargo trains would be more expensive than sea transport, they would take only 12 to 14 days, compared to 40 days by sea.
The service will be launched after the Chinese New Year in February, with plans to step up the frequency of round trips from one or two times a month to weekly ones, depending on demand. Nippon will track the goods using GPS and monitor ambient temperatures en route.
Nippon Express has earlier bought space on trains hired by local logistics providers but will now charter entire trains operated by Chinese rail companies, according to the Nikkei report. There, it is also stated that Nippon Express is exploring future collaboration with Chinese logistics companies and plans to work with a state-owned railway provider in Kazakhstan.
Trains from China are expected to carry auto parts, LCD panels and machinery, while auto-repair parts and electronic components could be transported from Europe to China. Shipments of e-commerce orders such as wine and baby formula are also being considered.
With the train initiative, Nippon Express is not only banking on expected cargo flows under China’s Belt and Road initiative, but apparently also expects an increase in the flow of goods between China and Europe as a result of the U.S.-China trade war launched by the Trump administration.
Eurasian cargo trains are becoming increasingly attractive
Since 2011, China has launched direct cargo train connections between 48 Chinese cities and 42 European cities. These have been subsidised by China under the Belt and Road initiative, which was proposed by Chinese President Xi Jinping in 2013 to boost China’s trade links with more than 80 countries in Asia, Europe, Africa and South America.
A recent report by the Centre for Strategic and International Studies (CSIS) has found that around 35 Chinese cities now have rail links with 34 European cities, and rail’s share of cargo by value grew 144% in the first half of 2017, compared with the same period in 2016.
Nol van Fenema