China express service industry may slow down

China’s fast developing express service industry may slow down in 2008 as cargo transportation demand from domestic and foreign companies may decrease due to the steam-losing US economy.

Logistics Association China envisions that foreign majors represented by DHL and Federal Express will tap the chance of Beijing 2008 Olympic Games to reinforce their leading positions in the Chinese market, while domestic players, especially private ones, which feature smaller business volume, weaker capital strength and poorer management, will see days get harsher.

Historical data show that China’s express service industry has been growing at a pace of around 30 percent in recent years and become one of the fastest growing markets of the world.

But according to DHL China, signs of slowdown actually appeared in 2007 though the Chinese market still maintained steady growth in the year, largely due to US economy deceleration and tax policy changes, which decreased cargo transportation demands between the two countries.

DHL said those companies used to adopt air shipment switched to relatively money-saving means as seaway shipment.

Another major foreign player Federal Express China is more optimistic, saying the Chinese economy to a certain degree can be independent from world market changes and it is certain that domestic express service market will continue stable growth momentum. Domestic analysts, however, hold that with market base getting increasingly bigger, the growth of domestic express service industry will get slower as compared to years ago.

China’s fast developing express service industry may slow down in 2008 as cargo transportation demand from domestic and foreign companies may decrease due to the steam-losing US economy.

Logistics Association China envisions that foreign majors represented by DHL and Federal Express will tap the chance of Beijing 2008 Olympic Games to reinforce their leading positions in the Chinese market, while domestic players, especially private ones, which feature smaller business volume, weaker capital strength and poorer management, will see days get harsher.

Historical data show that China’s express service industry has been growing at a pace of around 30 percent in recent years and become one of the fastest growing markets of the world.

But according to DHL China, signs of slowdown actually appeared in 2007 though the Chinese market still maintained steady growth in the year, largely due to US economy deceleration and tax policy changes, which decreased cargo transportation demands between the two countries.

DHL said those companies used to adopt air shipment switched to relatively money-saving means as seaway shipment.

Another major foreign player Federal Express China is more optimistic, saying the Chinese economy to a certain degree can be independent from world market changes and it is certain that domestic express service market will continue stable growth momentum. Domestic analysts, however, hold that with market base getting increasingly bigger, the growth of domestic express service industry will get slower as compared to years ago.