Think Railways

The PKP CARGO Group and Zhengzhou International Hub from the ChineseHenan Province will establish a joint venture specializing in rail container freight between Central China and Europe. The key project element is the Małaszewice dry port owned by PKP CARGO located at the Polish and Belarusian border. In result, the number of trains travelling between China and Europe co-serviced by PKP CARGO may increase up to 300 per annum.

The letter of intent signed on 16 June in Warsaw stipulates the scope and terms and conditions of cooperation between PKP CARGO and Zhengzhou International Hub. Both parties will establish a joint venture, in which each of them will hold 50% of shares, within three months from entering into agreement. The joint venture will draw-up a business plan for the investments in the Małaszewice logistics centre. By using the existing infrastructure, the centre will be adjusted to handle greater volume of Chinese containers and provide additional logistics services e.g. storage and packaging. Thanks to these investments, Małaszewice will be able to become the main hub for the containers transported from China to Europe by rail.

 “This unique agreement creates the new opportunities for trade exchange with China” - says Chief Executive Officer of PKP CARGO Adam Purwin. – “This is also the next step in execution of PKP CARGO international expansion strategy. Thanks to merger of the Czech AWT carrier we may offer our Chinese partners both complex logistics service of freight intended for Western Europe and access to the other markets of the Old Continents. Our cooperation creates also new development opportunities for export of the European goods on one of the largest global sales markets. This translates into new opportunities also for the Polish producers” - adds Adam Purwin.

At present, transport of Chinese goods to Europe is dominated by ships. Only 3.5% of export from the Middle Kingdom to the European Union is performed by land, despite many advantages of such solution - significantly lower cost comparing to air transport and even several times shorter freight period comparing to maritime transport. Rail freight between Central China and Germany is performed within 11 to 14 days comparing to 35 - 40 days by sea.

“Rail transport is an optimal solution for many groups of cargo, for which air route is not cost effective and maritime transport takes too long” – says Member of the Management Board in charge of Commerce at PKP CARGO Jacek Neska. – “At present, rail transport from China to Europe includes among others textile products, electronics and spare parts to machines and mechanical equipment. We hope that freight volume will increase continuously, including in the reverse direction” - adds Jacek Neska.

The “One Belt and One Road” concept assumes the establishment of the infrastructural connection network between China and Europe. Poland, due to economy size and geographical location, plays the important role in this network, since crossing of the main European transport routes to be connected with China under the new Silk Road lies at the territory of our country. Large part of rail container freight has been already carried to the Logistics Centre in Małaszewice owned by PKP CARGO, the largest dry port in Europe, in which cargo is reloated onto the wagons of the European track gauge.

 PKP CARGO Group is responsible for complex logistics services of the European section of the rail connection with China (Poland - Germany). A single train carries 41 40-feet containers, which translates into even 41 clients (one client - one container). At present, PKP CARGO Group co-serves three import trains and one export train. For container freight, PKP CARGO uses the new 80-feet containers for intermodal transport.

Cooperation with the Henan Province is a subsequent step, upon AWT merger, aiming at strengthening the PKP CARGO position as the integrated logistics operation of the European range. PKP CARGO Group is the second largest rail carrier in the European Union.