If you haven't noticed, there is a stampede to enter the Chinese transportation market. The attraction is obvious. China's rapdily growing economy, its importance in global trade and its huge population make it a very appealing country for North American transportation companies seeking to provide an end to end service. Facilitating the process is the fact that the country has eased restrictions on foreign involvement and its internal transportation market is becoming more open.

Barriers to Providing a National Service

However, China still presents formidable barriers to long-haul trucking. "It's easy to operate within a province," stated Evan Armstrong, President of Armstrong & Associates, a 3PL consulting company, "but moving from one to another can be almost like crossing a country border. You have to clear customs when you go from province to province." Even Sinotrans Ltd., one of China's biggest freight movers doesn't have a national network.

Schneider's China Strategy

The challenges have not stopped a number of major players from trying to take leaderhip role in serving this market. Early this year, Schneider National Inc. received approval to operate a trucking and logistics business in China. Serving the internal Chinese market, the company will operate as Schneider Logistics (Tianjin) Co. Ltd. Tianjin, a port city in the northeast, is China's third-largest urban area. Schneider expects to start small, with about 50 trucks and will study the market as it goes along. Schneider has signalled that it is working on potential acquisitions of two Chinese trucking companies that should close in the near future.

Con-way's China Strategy

In August 2006, Con-way Freight launched OceanGuaranteedSM - a time-definite surface freight transportation service in partnership with APL Logistics and APL servicing ports in Hong Kong, Shanghai and Shenzhen, China. This new "hybrid transportation network" links logistics operations in Asia, ocean shipping and day-definite, rapid response, domestic U.S. freight delivery systems provided by Con-way.

YRC's China Strategy

On June 26, 2007 YRC signed a preliminary agreement to acquire Shanghai Jiayu Logistics, one of the largest LTL providers in China. Shanghai Jiayu has more than 30,000 customers, 1600 employees, 300 tractors and more than 3000 vehicles. This will more than double the size of YRC's operations in China. "It's a pretty straightforwrd strategy," said YRC President and CEO Bill Zollars. "It allows us to begin building a platform in China and grow the ground transportation network that we can hook up to our North American network and provide an end-to-end transportation management," Zollars said.

Canadian Carriers Also Looking at China

Fastfrate, a leading Canadian transportation company has opened its first ever office in Shanghai, China. The company has hired Patrick Lawton, a former CP Rail employee who has worked in Beijing, China for the past six years.

Many More Announcements to Come

Clearly each of these players is formulating its own China strategy in a way that works best for them. It is anybody's guess as to who will achieve success and who will not. Stay tuned for many more announcements in the months and years ahead.