Multimodal Transport Cracks Challenges of Supply-Side Reform in Shipping Industry

As the secretary general of China Container Industry Association and the vice president and secretary general of China Communications and Transportation Association Intermodal Transport Sub-association, Li Muyuan pointed out, “At present, the Chinese economy has entered a “new normal” , in which logistics network has become an investment project of the most growth value.The development of multimodal transport is more important and urgent than ever for China logistics industry.”

In the 21st century, along with the restructuring and revitalization of the logistics industry, misallocations of transport resources and structural contradictions in connection and compensation of various modes of transport have become the main factor of limiting the development of the logistics industry.

In the Logistics Industry Long-term Development Plan (2014-2020) issued by the State Council, the first major project is multimodal transport.Unprecedented attention to the multimodal transport is inevitable in the development of Chinese logistics.With the adjustment of Chinese economic structure, the logistics industry has entered a phase of restructuring and development,in which reasonable modal split, efficient allocation of transportation resources and effective connection of different modes of transportation are needed to excavate profit source and find the value space of the supply chain；at the same time, the Belt and Road initiative makes theconstruction of logistics corridor feasible, which is no longer passive to follow up but initiative to guide the industrial layout, and then promote diversification of industries in Midwest area and become the economic development engine； Thirdly, upcountry gradient extension of manufacturing industry layout and changes in the supply structure stimulate new demands of the transport market, and also break the existing benefits pattern of the industry--railway, highway and shipping enterprises are all relying on traditional transport channel to explore development path of new logistics channel and seeking new growth poles by the cooperation of main stakeholders.Therefore, multimodal transport is not a simple problem about transportation mode or technology,but a strategic issue of Chinese logistics industry development.

In addition, multimodal transport itself is an important part of the supply-side reform in shipping industry.The essence of multimodal transport is the integration of resources, which is common in spirit with the shipping industry supply-side reform of “cut overcapacity” and“structural adjustment”.Multimodal transport emphasizes cooperation over competition.Since the multimodal transport demonstration project relies on the construction of logistics corridor, none of the companies can do everything all by oneself and accomplish full service through the corridor, therefore, joint demonstration projects are encouraged to carry out through the logistics corridor together by companies from different transportations and areas.Cooperation and collaboration is the essence and point of multimodal transport.As complementary, shipping enterprises laying out logistics corridor also means a role transformation from a shipping carrier to a multimodal transport business entity, which plays a very active role to further improve Chinese multimodal transport.Take international multimodal transport development as reference, a large number of shipping companies are actually carryout a multimodal job, and they are an integral group throughout the international transport chain； different from the bills of lading, there has been 20 years since developed countries began to undertake multimodal transport bills of lading with door-to-door integrative service.However, in China still not so much carriers are willing to undertake multimodal transport bills of lading.

Li Muyuan said, “Multimodal transport is an effective means to improve the logistics efficiency and industrial ecology, and a variety of conditions have been formed in China to support development of multimodal transport.Long-distance freight transport demand derived from westward manufacturing industry center and lowcarbon and green railway transport are attracting forces from society to actively enter the field.Therefore, we encourage qualified shipping enterprises to go into inland market and cultivate these enterprises to become the backbone enterprises in the field.Internationally, besides carriers with ships, there are many carriers without ships and agents of international cargo playing the role of logistics providers as multimodal transport operators.Obviously, in China paying attention to raise our ability to cultivate relative subjects is more important than investing in facilities currently in this area.We encourage qualified enterprises to transform to multimodal transport operator, while attaching importance to related systems,rules and international standards.”

Li Muyuan concluded, “Multimodal transport is highly coordination among all links throughout the transport chain.Enterprises are in the relationship of contractual collaboration, which emphasizes on integral service but no means integral assets.This requires special attention when enterprises enter this area.In addition, Chinese multimodal transport is continuing to evolve, during the phase of which problems of equipment technology,information technology and management technology are to be solved.”