SHANGHAI, CHINA:Heavy road congestions on the China-Vietnam border due to local COVID-19 related situations have resulted in soaring demand for newly launched two-way China-Laos rail services facilitating trade between China and ASEAN. Over 2000 trucks are in the queue on both sides of the main connection Pingxiang (China) bordering Lang S’on (Vietnam), causing delays of up to 20-30 days.

The alternative border at Dongxin (China) bordering Mong Cai (Vietnam), which reopened on 10 January, is still experiencing backlogs. Both congestions are expected to continue through to the Lunar New Year.

DHL Global Forwarding, the leading international freight specialist division of Deutsche Post DHL Group, and the first international forwarder to launch a two-way rail freight service between Kunming, China and Vientiane, Laos has seen significant uptake with a daily connection in each direction for its service on the newly opened China-Laos railway. The rail service shortens transit time between Kunming and Vientiane to about  20 – 24 hours, compared to 20-30 days with the present congestion through Vietnam.

Rail-truck solution between China & Southeast Asia: Key to keeping supply chains  running

“We launched the China-Laos Railway service in December and it was just in time. The backlogs on the road borders between China and Vietnam are not likely to clear before Chinese New Year, and it is really critical during this peak season to have the rail alternative,” said Steve Huang, CEO, DHL Global Forwarding Greater China.

“Thanks to the two-way rail service between Laos and China, we’ve been able to help customers keep their delivery timelines with limited delays. The service strategically positions Laos, a land-locked country, as a land-linked hub. DHL Global Forwarding has the most extensive road and rail services in the region, and our customers moving goods between China and ASEAN countries now have a strong viable alternative between air and ocean freight,” Thomas Tieber, CEO, DHL Global Forwarding Southeast Asia said.

Peak season relief: Faster, Cheaper freight from China to ASEAN

DHL’s scheduled service using the new China-Laos Railway is one of the six international economic corridors under China’s Belt and Road Initiative (BRI). The Laos section of the railway is 414-km that connects Kunming (China) to Boten, Laos’ northern border with China, to Vientiane in the south, on its border with Thailand. The route cuts the journey time from Vientiane to the Chinese border to less than four hours, compared to 15 hours by road (in normal conditions). At Boten, the railway will connect with the BRI network at Kunming, China, through another 595-km railway link, providing Laos with a land link to global and regional supply chains.

DHL’s scheduled service leveraging the China-Laos Railway runs in both directions between China and ASEAN markets, including Thailand, Vietnam, Cambodia, Malaysia, Singapore, and Indonesia, providing an attractive, highly cost-efficient alternative when logistics costs are at an all time high.

The two-way service combines trucking from all over China to the hub in Kunming, running through the China-Laos railroad, then onward with DHL’s established road network service and back, with significant cost savings and competitive transit times, providing a viable transportation alternative. Examples of the services include:

• Chengdu – Bangkok – road/rail services are 78% cheaper and 2 days faster than airfreight
• Kuala Lumpur – Chengdu – road/rail services are 70% cheaper, same transit time compared to airfreight
• Shanghai – Singapore – road/rail services are 38% cheaper, 4 days longer compared to airfreight