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2/22/2016
One the new silk road

Hardly any other trade route in the world is as shrouded in myth as the Silk Road. The roughly 11,000-kilometer overland route between China and Europe is currently experiencing a renaissance as an alternative to air and sea freight. DACHSER is one of the companies that send goods by train. It then feeds them into its groupage network, and companies like Wilo SE in Dortmund are reaping the rewards.
Wilo-qinghai-tibet-railway
On the new Silk Road

Back in November 2015, the manufacturer of pumps and pump systems with worldwide operations was facing a challenge. At its Chinese production site of Qinhuangdao, pump motors for the parent plant in Dortmund came off the assembly line too late to be shipped by sea freight. But the need for the engines was not urgent enough to justify the expense of air freight. Following the advice of its partner DACHSER, Wilo risked a new approach. For the first time, the company shipped its products on a freight train along the new Silk Road. However, it was routine for the logistics service provider. After all, several of DACHSER’s customers regularly use its LCL container service between China and Europe.

Wilo-railway-route
From China to Kazakhstan passing Russia and Belarus to head the distribution center in the Polish town of Malaszewicze

From East to West in 17 days From East to West in 17 days

First, DACHSER Air & Sea Logistics Shanghai organized the pick-up of the pump motors, sending them roughly 1000 kilometers by truck from the Wilo production site to Zhengzhou. There, the merchandise was loaded into an LCL shared container. The operator of the train received the loaded container at the terminal, and the journey along the new Silk Road began. This train route traverses China and Kazakhstan and passes through Russia and Belarus before it heads for the distribution center in the Polish town of Malaszewicze. An alternative is the Trans-Siberian route, which goes through Manchuria before crossing the whole of Siberia. Due to different track gauges on this route, the container had to change trains twice. At the destination railroad station in Hamburg, DACHSER organized customs clearance for Wilo as well as onward transport in their own groupage network and delivery to Wilo in Dortmund via short-distance transport. DACHSER refers to this intermodal coordination between business fields as “interlocking.”

“Starting with the train’s departure from Zhengzhou until it was delivered to Wilo in Dortmund, the LCL shipment took only 17 days,” says Alexander Nowroth, Business Development Manager Industrial, who is responsible for Wilo at DACHSER Air & Sea Logistics. Antonio Rodrigues, Group Inbound Logistics at Wilo, is already planning other transports by train because of the sustainability benefits this offers: “Shipping by air freight would have easily generated 13 times more CO2 emissions.”

Wilo-railway-lake-baikal
An alternative is the Trans-Siberian route via Lake Baikal

Old trade routes with new technology Old trade routes with new technology

The renaissance of freight trains in trade between East and West is based on the ancient Silk Road philosophy and is helping China develop new international business via the eight railroad stations that currently service this route. Things have changed since the Cold War, and today, the transport route is reliable, safe, and transparent: “Trains are generally on time, and train operators provide status reports at least every day, enabling you to track the goods via GPS,” says Helmut Lustinetz, head of Global Partner Management at DACHSER Air & Sea Logistics.

As far as volume is concerned, rail freight is naturally a niche product compared to sea freight. But it is well worth it, precisely when transit time is an issue (14 to 16 days compared with 38 to 45 days for sea freight) but not urgent enough for the expense of air freight, which gets the job done in 3 to 6 days. Experts are therefore assuming that use of this rediscovered route will increase significantly in the next few years. This will be a new and modern chapter in the history of the Silk Road.

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