Another week of little movement in rail traffic from China 07/02/20
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Another week of little movement in rail traffic from China
The logistics industry of China is gearing up to resume work on Monday 10 February, but in most cases this means working from home. Meanwhile, some large manufacturers have extended their holidays until 16 February. With this in sight, there is very little movement expected in the crucial supply chain between Europe and China.
The logistics industry is facing a standstill due to the outbreak of the coronavirus in China. The Chinese New Year holidays had been extended until 9 February. Although there was rumour of an official extension until 16 February, the Chinese government has not announced this so far. Instead, many companies have extended their ‘work from home arrangement’ until 17 February, notes Miłosz Witkowski from IFB International Freightbridge (Poland).
Home office
We received information from our Chinese head office that some Chinese enterprises and factories have extended the ‘home office’ or ‘stop working’ arrangement until 17 February”, he says on Friday 9 February. The fact that this is up to the companies own best judgement becomes evident when seeing other companies resuming work on Monday 10 February.
Whereas the logistics industry is able to make the necessary arrangements from home, some factories of automotive parts are less able to do so and have extended their factory closure until the same date. Japanese carmaker Toyota has said it will be keeping its 12 China plants closed for at least another week, with 17 February asa possible re-opening date. Nissan said earlier it was considering reopening most of its factories in China on Monday but would wait until at least Feb. 14 for facilities in and around Wuhan, the city at the center of the outbreak. And Fiat Chrysler has even stated that the impact of the coronavirus epidemic could halt production at one of its European car plants within four weeks.
No departure
For the rail freight sector, these announcements are of importance, as the automotive industry forms a large part of the cargo destined for Europe. The trains may be on schedule, but if the cargo is not there, they will not depart. Apart from the production of goods, they also depend on the availability of trucks to deliver the goods to the trains.
“We expect a train departure from Chengdu to Tilburg on 10 February”, said Jialu Zhang from GVT, a logistics firm in the Dutch hub of Tilburg. This train has bookings of cargo that has been stored in the terminal of Chengdu for two weeks.” But when it comes to new supply from the Chinese side, she remains hesitant. “There are no truck journeys planned to the terminal. We have our own branch in Chengdu, but we are not able to schedule truck departures either. The train is able to depart, but it remains to be seen whether these trains can be filled”, she mentioned.
Main hubs
Train departures have been also scheduled from other hubs. For example from Hefei, a train is scheduled to depart on 13 February to Neuss, while its Hamburg train is postponed from 12 to 17 February. A train from Chongqing should depart on 7 February, while it cancelled departures on 5, 6 and 9 February. From Xi’an, one of the busiest nodes on the New Silk Road, additional departures have been arranged in eastern direction, while additional westbound trains are in planning directly after 10 February due the high demand.
We have some trains scheduled from Xian to Ceska Trebova (and further to Dunajska, Vienna, Budapest) through our network, with departures on 16,22 and 28 February. But as mentioned before, this is the plan. We even have bookings, but nobody can guarantee at this point that the truckers in China will be able to serve it.
Updates in webinar
On Tuesday 11 February RailFreight.com organises another webinar, in which we call experts from within the field and based in China. These speakers are able to give the most recent update on the local situation.
The webinar is free of charge, registration can be done here.