Aug 26, 2013

Sankyu, Meiko Trans develop China-bound marine consolidation svc

Sankyu, Inc. and Meiko Trans Co. will further deepen their partnership. The two companies have long been engaged in the promotion of compatibility in their domestic/overseas networks and compliance with BCP, but have recently developed a joint product for marine cargo consolidations to Taicang port from the major domestic ports. The new service will kick off this week. The marine consolidation market has been faced with intensifying competition, but the duo think that the creation of a consortium and alliance such as those among operators is needed in the world of NVOCCs, so they have vowed to become the pioneer in this segment.

The two firms began their collaboration in the 1990s with the utilization of a mutually complementary network. So from the conventional gentlemen's agreement-type of relationship that was sealed in 2007, the duo have ventured into a more concrete relationship. They have been boosting results to a certain degree through such means as carrying out joint marketing activities per project.

Further, they kicked off a transport service in 2009 that utilized the container vanning technology (CVT) system for heavy cargoes that was developed by Toyota Steel Center.

They also have a complementary relationship as their overseas networks have different forte regions. Their partnership has been spreading to their overseas interests as manifested in such collaborations as their linked transport and delivery services in India and other regions where they both have local subsidiaries.

With regard to marine transport, the two companies had been co-loading their consolidated cargoes to Hong Kong since May 2008 and to Shanghai since July 2009. With the Taicang-bound cargoes, however, they will engage in a deeper tie-up such as consolidating their local CFS and agents.

Shanghai port, which is the gateway to the Shanghai economic zone, already has a large number of marine consolidation companies in proportion to the market scale, so competition is becoming increasingly fierce. It has also become difficult for companies to differentiate their transport products.

Taicang port is located at a point that traverses about 40 kilometers of the Changjiang from Shanghai port, with better access to the major inland cities such as Suzhou, Wuxi, Changshu and Kunshan, where there Japanese-affiliated companies are gathered, compared to Shanghai port. Further, the transmission of manifest data prior to ship arrival is possible, so this port is famous for its swift devanning and customs clearance with the assistance of the Jiangsu government. In the case of consolidated cargoes, using Taicang port can shorten the lead time from ship arrival to cargo pick-up by 1-2 days compared to when cargoes are unloaded at Shanghai port.

Recognizing the superiority of Taicang port, the two companies kicked off trials in April. They have also announced the support system provided by the port authority, customs agency and other public and private entities in Taicang toward the active use of their local port. They decided to foray into full-fledged operation in Taicang port upon realizing that they would be able to offer stable services there.

Hideaki Watanabe, head of Sankyu's international multimodal transport division (Left side in the photo), talked about the meaning of the new service, saying that, "We regularly hold sales meetings and through such venue, we have been exchanging information on such matters as glass paneling in terms of costs. The latest product is not a simple co-loading scheme. We will be able to mutually view various information through the sharing of hardware (CFS) and so on, but note that this has only become possible as a result of our relationship of trust through long periods of collaboration." Meanwhile, Toshiyuki Ninomiya, manager of Meiko's international comprehensive transport division (Right side in the photo), claimed that, "The consolidation market is facing hard times as it is a competition among a number of powerful entities. We will not be able to survive if we do not consider such strategies as forming consortia which is done by shipping companies. We want to be the pioneer in this respect."

The companies will capture cargoes with the new service, targeting small-lot cargoes such as electronic/electrical and mechanical parts. They are eyeing the cargoes of manufacturers and trading houses by utilizing the Taicang warehouse as their stock point while assessing their track record. Further, they will make use of their Chinese subsidiaries to realize various plans such as establishing a door-to-door service to inland cities.

Marketing at the Keihin (Tokyo and Yokohama) and Hanshin (Osaka and Kobe) regions will be handled by Sankyu, while Meiko will take charge of marketing at Nagoya and its surrounding areas. The new service, which kicked off with the departure of the ship from Nagoya port on September 5, utilizes Taicang Container Lines Co. (TCLC). Sankyu and Meiko also plan to offer import consolidation services for ex-Taicang Japan-bound cargoes in the future, targeting the end of the China foundation holiday in early October this year as the start of such services.

Schedule from each CFS is as shown in the accompanying schedule. Ships will arrive at Taicang port on Monday of the week following the departure date.

*Kanto region: CFS cutoff at Yokohama will be Monday, with the ship departing from Yokohama on Wednesday
*Kansai region: CFS cutoff at Osaka will be Tuesday and Wednesday at Kobe, with the ship leaving Kobe on Friday
*Nagoya region: CFS cutoff at Nagoya will be Tuesday, with the ship departing from Nagoya on Thursday

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