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by martinald 3454 days ago
Agreed. I really can't see this being a success for anything more than PR. If you need it ASAP, you're going to use airfreight. If you don't you're going to have it by sea. I don't see much of a need for something in between those two timeframes. Anyone specialised in logistics care to comment if there is an actual market here?
5 comments

I'm a software developer working with embedded devices, but I sometimes hear snippets of conversations regarding logistics. The story can be something like this:

The device is manufactured, flashed, and packaged in China, and normally shipped by sea. But now demand has gone up, or production has been slightly delayed, and we need to get devices to customers. Maybe we will run out of stock in 1-2 weeks. We can't really (only) load a container ship and not be able to get devices to customers for a couple of weeks when demand is high. The logistics team then tries to ship limited quantities by air and/or train to bridge the gap until the next container ship arrives.

Hence my (very limited) experience tells me there is definitely a market for something like trains with time and cost in between air freight and container ships.

Compared to container ships, freight train is another option. Although not many, there are times when the goods are needed more urgently than container ships (think of some industries that require parts urgently but cannot afford air). In addition, some landlocked cities simply do not have container ships as an option. They need to ship goods to a nearby port by train or truck and then load all the containers to a ship.

From this article http://richardtorian.blogspot.com/2012/01/cost-per-ton-mile-..., you can cut the shipping costs by train to a pretty low level.

There are people who want more than just the within-a-day (air) or within-a-month (sea) options. When you ship something cross-country (for the US) by Ground, that's going by train for most of the journey.
I'm not into logistics, but following this out of curiosity. In Germany this started in 2008, and didn't make sense to me either. Got aware of it because the local press covered it. (Sorry for the german links) http://www.mopo.de/peking-hamburg-container-express-der-mons... , http://www.mopo.de/-trans-eurasia-express-hier-kommt-der-xxl... Then over the years, it was busisness as usual, slowly expanding: http://www.wiwo.de/unternehmen/dienstleister/china-zug-deuts... , http://www.dbschenker.com/ho-de/news_media/presse/corporate-..., https://www.welt.de/wirtschaft/article118648469/Neue-Bahnver... , https://www.welt.de/regionales/duesseldorf/article126318669/... , http://www.transa.dbschenker.de/log-transa-de/start/China_Co... , http://www.sueddeutsche.de/wirtschaft/von-westeuropa-nach-ch... ,https://www.deutschland.de/de/topic/wirtschaft/globalisierun...

The gist of all that german garble is that it is about twice the speed of sea freight, measured "door to door", while costing only half as much as air freight, but twice that of sea freight. co² emission is calculated as half of that of sea freight, and 25 times less than air freight. In 2016 they shipped somewhat over 40.000 containers in about 400 trains, which carry about 50 containers per train.

The NYT covered this in 2013 with an interactive feature: http://www.nytimes.com/newsgraphics/2013/07/21/silk-road/ http://www.nytimes.com/2013/07/21/business/global/hauling-ne...

hth

almost forgotten: https://en.wikipedia.org/wiki/Trans-Eurasia_Logistics https://en.wikipedia.org/wiki/Chongqing-Xinjiang-Europe_Rail...

That would mean that airfreight is only 4 times as expensive as shipping? I'd expect it to be at least a magnitude more expensive, if not more.

I guess half as much as airfreight means that it's still considerably more expensive than shipping. But for 14 days vs 30-45 days it might well be worth it.

That depends on the shipped goods, i think? One calculation was that of a 15 inch notebook at 2kg weight, they wrote: 28 days per ship, at 2,50 € and 184 kg co². By air 3 to 4 days at 23 € and 4950 kg co² emission. By train 17 to 18 days at 5,50 € and 270 kg co². But that is for a laptop, packaged in a specific volume with that weight. They also ship tires, automobile parts, shoes, clothing, textiles, whatnot.... in both directions btw. BMW ships parts from .de to .cn
Yep, air freight is generally by weight, shipping by volume. Electronics are already sent via air, saving $3 shipping on a $1500 item doesn't make much sense. Taking the UK as an example, 70% of non-EU exports by value go via Heathrow. Would expect the value to be similar for China. By volume it's probably low single digits for airfreight, by value likely >50%.

Low value items and very heavy items are currently not viable via airfreight, that's probably where trains can be profitable. If you produce clothes your only options are to either do so in Europe (there's a lot of production in Turkey) and have it close by, or produce in Asia and wait 40 days for every order. Cutting that time for a premium could make a lot of economic sense.

Yes, I was thinking this would be useful for fashion.

If you suddenly find a particular style/colour of item is popular and selling out it might make sense to get more items shipped via train and have them arrive in 2 weeks.

If you have to put it on a boat and wait 6 weeks you may have missed your chance to sell that item (e.g., people are moving on from summer to autumn clothing, etc.).

My guess is simply logistical redundancy. If the shipping lanes were impassible for some reason (blockade? ports damaged due to tsunami?), goods could still be sent/received via rail more cheaply than by air.

Could also be a way to spur growth too. If you need to spend money on something, infrastructure seems like a decent choice.