UPS expands global offerings with new China-Europe rail service

In a move geared toward expanding its global forwarding services and provide shippers with more options, UPS recently announced that it has added a Full Container Load (FCL) rail offering to its China-to-Europe services portfolio.

This rail service runs from Chengdu, China to Lodz, Poland and from Zhengzhou, China to Hamburg, Germany, UPS said, and it added that the rail movements, coupled with a trucking network, enables UPS to provide increased service to shippers in China and Europe.

“Our customers are looking to UPS for ways to achieve their business objectives of reaching new markets and reducing costs,” said Keith Andrey, UPS vice president of ocean freight and multimodal services, in a statement. “We are excited to add our rail option for our customers in one of the world’s largest freight lanes to complement our existing ocean and air freight and package capabilities. This gives customers access to a broader transportation portfolio to better meet their business needs.”

A UPS spokesman told LM that the new rail service is up to 50 percent faster than ocean freight and up to 70 percent less costly than air freight.

“Based on market data for ocean sailing and train routings, customers may achieve up to 50 percent transit time savings for lanes like Chengdu to Prague, while savings will likely be lower and up to 30 percent for coastal pairings like Shanghai to Hamburg,” the spokesman said.

UPS said that the new rail service is well-timed to meet the needs of shippers in terms of balancing supply chains, citing a study from Seabury that noted more than 70 percent of shippers expect a moderate to strong shift to lower cost modes over the next 1-to-3 years.

The UPS spokesman said that the company’s customers are looking to improve their supply chain and cut costs while obtaining a time-in-transit that best fits their business.

“The solution will be similarly positioned and has a similar value proposition as Sea-Air, meaning it is slower and cheaper than Air Freight, but more expensive and faster than Ocean Freight,” he said. “UPS is always looking to ensure we have the right products and services to best serve our customers. UPS began evaluation of rail as a possible transportation solution on the China-Europe lane in 2013, and, after thorough evaluation, began offering the service to our customers in the second quarter of 2014. This is an expansion of our forwarding services and gives customers more options in the Asia-Europe lane. Like other multimodal offerings, the rail solution will save money for customers shifting volume from air freight to rail.”