Chengdu intermodal ‘Air-Rail’ pilot could be model for China parcel logistics

By taking advantage of China’s large and expanding high-speed passenger railway network, a new “Air-Rail” pilot program that began last month may give the country a new option to expedite parcel shipping to and from regions that are poorly served by major airport hubs. Many see China’s high-speed rail as a supplement to, or perhaps even a replacement for, regional feeder flights, which, in other regions of the world, link smaller cities with major air hubs.

On Aug. 29, China Railway Express, the freight affiliate of the state-owned China Railway, accepted a package at a collection center in Mianyang, 150 kilometers northeast of Chengdu’s Shuangliang Airport (CTU), and registered the shipment in the SF Express system. The parcel was then loaded onto a high-speed train bound for Chengdu airport, where it arrived 90 minutes later and was handed off to a Sichuan Airlines cargo agent. From there, it was loaded onto a Sichuan Airlines flight headed to Shanghai Pudong International Airport, where it was handed over to SF Express for last-mile delivery.

In terms of speed and efficiency, it took just four hours from the time the parcel was accepted in Mianyang, until it was loaded into the belly of the Sichuan Airlines aircraft – approximately twice the speed of traditional road transport. With the cooperation of the Chengdu Railway Bureau, the Sichuan Airport Group and various airfreight entities, the stakeholders in the pilot project work together to facilitate seamless point-to-point parcel transfer.

Although express companies like SF were previously able to utilize rail capacity on some lines, this new program offers single-window booking directly to customers. Shippers using the service only need to fill out a single “air-train” transport bill for point-to-point delivery.

Moving forward, pilot tests will continue in Sichuan province, with the ultimate goal of expanding Air-Rail options in other parts of China as well.

One major complication preventing the program’s expansion, however, is inter-provincial collaboration on rail transport. When it comes to pricing, marketing and revenue sharing, many believe that fragmented regional rail entities will face some difficulty in reaching an agreement. For now, a shipper based in neighboring Yunnan Province would not be able to utilize existing Chengdu-bound rail links as part of the air-rail program, but that is not to say Chinese logistics companies are not trying to make it a possibility.