Rivals fret as China Post unveils fast delivery bid

Foreign express freight operators on the mainland have voiced fair-play concerns over a new service launched by China Post to try to regain lost market share.

China Post lost its monopoly under World Trade Organisation competition rules which allowed foreign companies access to the mainland market two years ago.

China Post’s share of the burgeoning express delivery market has slumped from 97 per cent to under 40 per cent in the face of competition from DHL, FedEx, UPS and TNT.

Now China Post is fighting back with a new all-night freight service between 136 cities in 27 provinces. The service, without any increase in charges, will also focus on fast turnaround links between the hub of Shanghai and six major urban areas: Beijing, Guangzhou, Shenzhen, Xiamen, Shenyang and Weifang.

“The new programme aims to provide high-quality service to clients and to improve the competitiveness of our express mail-service business,” said a China Post spokesman.

But the executive director of the Conference of Asia Pacific Express Carriers, Ira Wolf, said foreign operators were concerned that China Post might be using unfair advantages.

“The express delivery service provided by China Post is not part of its monopoly services, so it should completely follow market rules with no special benefits either in terms of receiving money or subsidies from the government or any special treatment that other express companies in China do not receive,” Wolf said.

“If the new service takes advantage of special benefits that the government gives to China Post, or if the administration of China Post helps finance it, or the service gets special rates from postal airlines and foreign express carriers in China cannot get the special rates, this could be unfair competition.”

Wolf’s organisation groups FedEx, DHL, UPS and TNT.

It has already called for the separation of the administration of China Post from the business of China Post.

“In other words, there should be an independent government regulator who is independent of China Post to make sure there is no unfair competition that would impede growth of the foreign express carriers in China,” he said.

From Wednesday, China Post is moving express mail overnight in and out of Shanghai, especially from Beijing, Guangzhou, Shenzhen, Xiamen, Shenyang and Weifang.

Express delivery will reach destinations in the six cities and Shanghai before noon and will arrive in the other cities before 5pm.

The China Post official said the new service cut delivery times from 48 hours to 24 hours.