Quality management for resilient and sustainable logistics

In November 2010, the first two Hupac test containers arrived in Shanghai by rail. It took two whole years of preparation to develop the route stretching around 10,000 kilometres from Ludwigshafen via Slawkow, Moscow, Novosibirsk and through Mongolia all the way to China. Different track gauges, power systems, languages, alphabets and regulations had to be quite literally combined. The business model that Hupac used to overcome this challenge is also based on combination: Hupac is responsible for the European part, combined transport operator Russkaya Troyka handles the Russian part and rail forwarding agent Eurasia Good Transport takes charge of the Chinese stage.

Why is the transport industry looking for a land route to the Far East, and why is Hupac investing in this sector? The industry is interested in a continental alternative to diversify traffic flows and achieve greater stability. In addition, more and more industries are settling in the interior of China, which brings them far closer to Europe. What is more, ships tend to load light goods, whereas the railway could offer interesting conditions for heavier goods. Lastly, some goods are not approved for maritime transport but can be carried by rail.

So there are signs that the land route between Europe and the Far East may become an interesting growth market for combined transport in the medium term. Around 8 million TEU are currently shipped between Europe and China, with growth rates of 10 to 15% per year. If just a fraction of that were shifted onto the railways, the intermodal transport industry would have a huge volume to handle.

Hupac will monitor these developments closely in the coming years and invest moderately in the future market of Eurasia. In the past year, 3,000 load units have already been carried between Western Europe and various Russian destinations in partnership with Russkaya Troyka. The test run with 200 containers between Ludwigshafen via Vladivostok to Busan in South Korea that started in June 2010 was also a success and was a starting point for further activities in the Far East.