FedEx plunges in Qingdao Logistics War
FedEx announced days ago that it had commissioned a branch in Qingdao, a Chinese coastal city.
Located in the Sifang District of Qingdao, the branch covers an area of 3,300 square meters. Its ground operating station is able to handle 1,600 articles per hour at most. The station is also equipped with advanced monitoring system that can work for 24 hours a day, ensuring a real-time monitoring over the packages.
The US logistics giant aims to enhance its outlet distribution and operating capacity in northern China so as to meet the increasing demands for international express services here.
The establishment of Qingdao branch is conducive for FedEx to greatly improve its service level in the city and for Qingdao to further consummate its logistics infrastructure.
That echoes with Qingdao's objective of emerging as a regional center for international shipping and international logistics by 2020, said Wilson Chung, general manager of FedEx- DTW Co., Ltd., FedEx's joint venture with Tianjin DTW Group Co., Ltd.
As a matter of fact, it is another foray into the city by the global leading logistics giants. Last July, UPS launched a route to the city flied by all-cargo planes. DHL followed suit by announcing that it would speed up the move of offering all- cargo services in Qingdao.
Qingdao is one of the largest logistics distribution centers in the northern region. Those who take the leadership in the market will be sure to become the bellwether of the logistics industry in North China, an official with the local logistics association told journalists, and it is the very reason for so many magnates to make inroads into the city.
As one of the most important economic cities in the northern region, Qingdao shows robust momentum for foreign trade expansion.
In the first five months, Qingdao cumulatively received USD 13.589 billion in import and export value, representing a year- on-year rise of 18.4%.
At present, it boasts a unique position in the country in the economic and trade fields. The city has developed logistics industry bolstered by convenient marine, land and air transport, thereby showing strong radiation to Japan, South Korea as well as its neighboring provinces and cities.
In addition, it is the sole partner city for Beijing 2008 Olympic Games, meaning an unprecedented opportunity for the development of logistics industry.
The city now has six pillar industries and exports to the world's major markets including the United States, the European Union and ASEAN Free Trade Area.
FedEx-DTW has had 26 branches and 38 ground operating stations nationwide, enabling it to extend services to in excess of 200 Chinese cities.
FedEx is said to redouble its efforts in consummating its network construction in the country and include 100 more cities into its service networks over the following years.
Along with its expanding businesses in the country, FedEx is showing an increasing hope of divorcing from its Chinese partners, especially after China allowed foreign logistics companies to set up their wholly-owned subsidiaries in the country as pursuit to its WTO commitments.
This January, it signed an agreement with DTW Group to purchase the remaining 50% stake held by the latter.
FedEx predicted that it would own more than 6,000 staff in the country after the deal comes into effect. The deal is still subject to the approval from relevant governments and conventional procedures for obtaining related certificates. The company is expected to finalize the deal in next fiscal year.
(USD 1 = CNY 8.0)
