China launches first freight train to London

A new freight train service between the Chinese city of Yiwu in Zhejiang province and London opened on Sunday, aimed at cutting the time and cost of moving freight between the two countries.

The new service, which will take 18 days door to door, is operated by China's Yiwu Timex Industrial Investment Co, which has been running freight trains twice a week between China and Madrid in Spain via the German city of Duisburg for more than a year. The London service will run once a week during its trail period.

Oscar Lin, manager of the London-based Onetwothree Logistics, sole UK agent for the service, said: "This cargo train service highlights important trade partnership between the UK and China post-Brexit."

Onetwothree Logistics is in charge of handling the UK customs clearance and distribution for Chinese exports, and collecting UK exports for the return train to China. Lin said the key barrier to entry for running a UK-China freight train service was negotiating with all different governments in countries along the train's route, and creating the most suitable journey by selecting desired tracks to complete the service.

The new service comes on the back of a trend of increasing competition by logistics firms to serve China-Europe cross-border trade. In November 2015 Shenzhen-based STO Express became the first major Chinese delivery firm to set up its own dedicated fleet of planes and trucks for deliveries across Europe.

Its thrice-a-week cargo flight run between Hong Kong and Prague will carry items to all countries in Europe, including the UK. The company said it wanted to grab a quarter of the China-related market from big global delivery firms such as DHL and UPS in the next few years, as its fees are only half theirs.

Chinese research firm iResearch statistics show China's cross-border imports grew from 100 billion yuan ($15 billion) in 2014 to 150 billion yuan in 2015, and is forecast to hit 210 billion yuan in 2016.

The new freight train service is being welcomed by industry insiders.

Mike White, group operations director at the UK's Brunel Project Cargo, said: "This is going to change the way a lot of forwarders and shippers view their imports and exports for China."

White said the service's key advantage would be its quick transit time, and is very suitable for exporters whose products are delayed in the manufacturing process and want to save time during delivery.

The cost of rail freight is half the cost of airfreight and half the time of sea freight.

Lin said the service mainly serves China-UK trade, but it will also make stops in Germany and France to serve China-Europe trade.