New Zealand Truck & Driver - - Front Page -

THE HIS­TORIC SILK ROAD OVERLAND TRADE route be­tween Europe and China has been re­vived as a re­sult of the global COVID-19 pan­demic.

A Euro­pean dig­i­tal freight-for­ward­ing agency, which has been in busi­ness four years – tak­ing on­line book­ings for door to door truck trans­port and of­fer­ing them to the 12,000 Con­ti­nen­tal car­ri­ers on its books – has seized the op­por­tu­nity pre­sented by the pan­demic.

The air­line in­dus­try’s vir­tual shut­down be­cause of the COVID-19 emer­gency left an es­ti­mated $US222­bil­lion an­nual two-way trade be­tween China and Ger­many re­duced to a trickle.

With Ger­man com­pa­nies des­per­ate for elec­tron­ics com­po­nents sourced from China, In­staFreight was ap­proached to ex­plore a new sup­ply chain.

In­staFreight dis­cov­ered that a truck­ing route from China, through Mon­go­lia, Kaza­khstan, Rus­sia, Be­larus and Poland, was a vi­able op­tion – even though it’s 10,000-kilo­me­tres each way, across the Eurasian Steppes.

That’s a trip that will take around three weeks, in­clud­ing time al­lowed for freight to be trans­ferred to/from Chi­nese trucks at the Chi­nese bor­der.

It tested the mar­ket in early April – a time when the death toll from COVID-19 was still ris­ing across parts of Europe.

It be­gan of­fer­ing con­sign­ments be­tween China and Ger­many – Euro­pean truck own­ers bid­ding for the loads in on­line auc­tions.

Hun­dreds of op­er­a­tors with trucks ca­pa­ble of car­ry­ing 40 tonnes all-up re­sponded within days.

Com­pany co-founder Philipp Ortwein says that since then scores of trucks have made the huge trans-con­ti­nen­tal run – with “hun­dreds more” about to em­bark on the Silk Road ex­pe­ri­ence.

“Dig­i­tal­i­sa­tion is emerg­ing as a sur­vive-and-thrive tool in the cri­sis and is cred­i­bly poised to shake down key eco­nomic sec­tors post-COVID,” says Ortwein.

The go­ing rate for a 20t truck­load of freight from China to Europe is reck­oned to be around 15,000 Eu­ros (ap­prox­i­mately $NZ26,700), com­pared to one mil­lion Eu­ros ($NZ1.78mil­lion) for a char­tered air­craft ca­pa­ble of car­ry­ing 100t of freight. Thus the road freight cost is less than 10% of the cost of air­freight.

Nor­mally, over half of Ger­many’s air­freight trav­els on pas­sen­ger flights, which have been se­verely cut back in the COVID-19 cri­sis.

And ac­cord­ing to In­staFreight, the back­log of air­freight at Chi­nese air­ports is such that the 20 to 22-day truck trip (depend­ing on the pickup and un­load­ing lo­ca­tions in Europe), is on a par with COVID-19-era air­freight de­liv­ery times.

Two-driver teams, of­fered at a sur­charge, can take sev­eral days off the truck trip.

Ger­many was China’s big­gest ex­port mar­ket in Europe last year – im­port­ing mo­bile phones, com­put­ers, elec­tronic com­po­nents and house­hold elec­tron­ics. On the other hand, China was Ger­many’s big­gest mar­ket for its ma­chin­ery, cars, car parts, chem­i­cals and elec­tronic goods.

Says Ortwein: “As a freight for­warder it is our role in such times to be prag­matic and to find so­lu­tions to prob­lems such as the cur­rent stag­nant flow of goods from China to Europe.

“Our dig­i­tal prod­uct as well as the ag­ile struc­tures help us re­alise such so­lu­tions with an ad­e­quate prompt­ness. For sys­tem­i­cally rel­e­vant goods, ev­ery day counts.”


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