Alibaba logistics arm rolls out container booking service

  • The service offered by Cainiao Smart Logistics, the logistics arm of Alibaba Group, links 200 ports
  • The service offers 30-40% lower than the average cross-border port-to-port shipping fee market rate
  • Container bookings confirmed in as fast as two business days versus industry average of one week to a month
  • Merchant entitled to compensation if cargo misses the departure time after booking due to Cainiao or its partner

Cainiao Smart Logistics Network, the logistics arm of Alibaba Group Holding Limited, has launched a container booking service for air and sea freight spanning over 200 ports in 50 countries.

The service encompasses booking of containers and the end-to-end logistics management in the line haul process, the company said in a press statement.

While the global container shortage has increased shipping costs, Cainiao said it is able to offer a cross-border port-to-port shipping fee which is 30-40% lower than the average market rate. In China, the ports include those located in Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Hangzhou, and Yiwu.

Container bookings are confirmed in as fast as two business days after an order is placed by the merchant, versus the industry average of one week to a month, with compensation up to RMB100 (US$15) per order if the booking confirmation is delayed.

If a merchant’s cargo misses the departure time after booking due to Cainiao or its partner, the merchant is entitled to a compensation of RMB1,000 (US$155) per container for sea freight shipping or 20% of international sea freight shipping fee, whichever is higher, 50% of near-sea freight shipping fee, and 10 per cent of air freight shipping fee.

“In the face of the current global container shortage and surging shipping prices, Cainiao is committed to leveraging our technology and logistics ecosystem to provide a one-stop port-to-port shipping solution for exporters and importers. By working closely with airlines and cargo companies, we aim to safeguard the entire cross-border line haul network and instill greater stability into sea and air freight shipping.” says James Zhao, General Manager of Cainiao Global Supply Chain.

Globally, approximately 60% of goods are shipped by container via 180 million containers worldwide. Most recently, the surge in demand for shipping containers in China, coupled with delays in containers returning to China due to the pandemic, has resulted in a severe container shortage and soaring freight rates which impacted export and import businesses. Merchants dealing with exports outside of China are also impacted as container ships rush back to China without waiting for cargo space to be fully utilized, in order to cater to the huge demand from Chinese exporters.

Data from China Container Industry Association also revealed that the average container turnaround times have increased to 100 days from 60 days previously because of capacity cuts in Europe and the United States. These ports struggle with lack of workforce and infrastructure to handle the surging inbound goods which in turn delay the return of empty containers. This has further exacerbated the shortage.

This post was published on January 14, 2021

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