Consultant’s Insight: Geodis launches Southeast Asian road network

Transport and logistics company Geodis officially launched its road network from Southeast Asia to China last week, currently connecting Singapore, Malaysia, Thailand, Vietnam and China, and later to be extended to Hong Kong and Indonesia. [caption id="attachment_76185" align="alignright" width="250"] Cathy Roberson, Cargo Facts Consulting senior consultant and Air Cargo Next columnist[/caption] The intermodal road-sea service includes dedicated customs brokerage and integrates with air and seaports. “The Association of Southeast Asian Nations (ASEAN) and China are two of the fastest-growing economies in the world,” Onno Boots , president and chief executive of Geodis Asia Pacific and Middle East, said in a statement. “As the region remains poised for growth, Geodis sees the extension of our road network to China as an opportunity to enhance our multimodal solutions and connectivity across major air hubs and seaports to give customers greater flexibility and reliability.” The road network boosts Geodis’ capabilities and infrastructure to match customer growth in the Asia Pacific region, the company said. Sourcing diversification U.S. and European shippers learned during the pandemic about the need to diversify suppliers and manufacturers. China’s rigid stance on the pandemic resulted in closures and delays that reverberated across many shippers’ supply chains. Since then, political tensions between China and the United States have caused multiple shippers to spread their sourcing across a much wider geographic area . However, supply-chain shifts are gradual and will differ significantly by industry, according to the Economist Intelligence Unit, the research and analytics division of The Economist. For some sectors, such as finished electronics or automotive parts, Asia, particularly Southeast Asia, is already home to many production sites as an alternative to China. This should allow for a relatively quick rerouting of manufacturing and logistics activity. Indeed, ASEAN has been a destination for manufacturing for several years now. It has also become entwined with China’s manufacturing supply chain, similar somewhat to the United States, Canada and Mexico relationships. The ASEAN and China interdependence has grown significantly over the years, according to RBC Wealth Management . ASEAN countries imported $177 billion of goods from China in 2012. This more than doubled to $388 billion by 2021. In addition, as of 2021, China is the third-largest international source of foreign direct investment in the ASEAN region at $14 billion, behind the United States’ $40 billion and the $21 billion that ASEAN countries invest in one another. However, ASEAN countries are seeking increased access to the U.S. market to counter their trade dependency on China. In 2021, trade in goods and services between the United States and ASEAN reached $441.7 billion. The top goods exported from ASEAN to the U.S. include electrical machinery, nuclear reactors, apparel and furniture, according to consulting firm Dezan Shira & Associates . Join Air Cargo Next for its second annual Air Cargo Tech Summit on Sept. 18-19 in Brussels, sponsored by Unisys and Brussels Airport and featuring a fireside chat with Brian Hodges, managing director, American Airlines Cargo. For more details and to register, click here .

Consultant’s Insight: Geodis launches Southeast Asian road network

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