UPS adds to Preferred portfolio with LCL China-to-Europe rail offering

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By Jeff Berman, Group News Editor
July 15, 2015

Transportation and logistics bellwether UPS said this week it has expanded itsUPS Preferred multimodal freight services portfolio with the introduction of a less-than-container load (LCL) option for China-to-Europe rail shipments.

The company’s Preferred offerings feature air, rail, ocean, and/or ground transportation, which endeavor to help shippers balance supply chain speed and costs to meet the needs of their customers. UPS officials said that the Preferred LCL service enables shippers to bridge the speed and economy gap between air and ocean freight services.

UPS’s China-to-Europe LCL option for rail shipments is available from Zhengzhou to Hamburg, with the company also having established a Full Container Load (FCL) offering for China-to-Europe in June 2014. 

“Our customers continue to look for ways to improve their supply chains by cutting costs and optimizing time-in-transit services,” said Steve Flowers, president of UPS global freight forwarding, in an interview. “The introduction of our UPS Preferred FCL service in 2014 demonstrated our ability to address cost and time-in-transit needs, so the introduction of less-than-container load was a logical extension.  UPS’s expansion of the rail product portfolio in China addresses the need for new logistics solutions along the Silk Road Economic Belt.”

The UPS executive noted that since this new offering is part of a bigger portfolio of services, it’s been part of a long-term strategy and will continue to evolve based on customer needs.

As for shipper feedback to this new offering, Flowers said that shippers are
looking for a ‘middle ground’ option between air and ocean in an effort to balance speed and cost.

“The Preferred LCL rail service from China to Europe is an expansion of our forwarding services and gives customers more transportation options to deliver on the growing demand on one of the largest and busiest trade lanes,” he explained. “Like other multimodal offerings, the rail solution will allow air freight customs to cut cost by shifting volume from air freight to rail and for our ocean freight customers, the rail solution will expedite container shipments. To date, the service is being received positively by our customers.”

And UPS said that those shippers who have leveraged the China-to-Europe FCL service have seen cost savings up to 65 percent compared to air freight, with nearly 40 percent in time savings compared to traditional FCL ocean service offerings for the same routes.

These China-to-Europe FCL service offerings run from Chengdu to Lodz, Poland and from Zhengzhou to Hamburg, Germany. UPS noted that the meshing of rail movements with origin/destination trucking networks makes it possible it to offer this service to shippers in China and Europe.