China reshapes global supply chain

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“The road to Sichuan is as hard as the road to heaven,” wrote the famous Tang-dynasty poet Li Bai in the 8th century.

Surrounded by high mountains, transportation in and out of the southwestern province of Sichuan has been a challenge for centuries. China Railway Express, however, along with other great projects brought forth by the Belt and Road Initiative, have changed the face of the country’s hinterland, and the global supply chain.

An all-reaching logistics hub

Chengdu government laid out a comprehensive plan to connect the city with the rest of the country and the world. The government has till August launched 745 cargo trains to other cities, connecting upstream suppliers from cities as far as Guangzhou and Xiamen.

The Chengdu-Europe express train has already made 430 trips from January to July. On average, two trains are departing daily from Chengdu to Europe. Suppliers, manufacturers, and consumers around the globe have never been closer.

Digitalized manufacturing

One of the companies moving their manufacturing bases to Chengdu because of the city’s comprehensive logistics network is Dell. But good logistic is not enough, Chengdu plant of the firm has arguably the best technology in the world.

The factory does not require a storage. The computer parts are delivered from one end of the plant, assembled in two hours and computers are shipped from the other end of the factory.

“We are a technology company. Our mission is to deliver products to the customers as fast as possible,” said Zhang Yaohua, vice president of Dell China.

Shipping procedure is digitalized. Before the computers are shipped out, each shipment gets a barcode that contains model specification, destination, and custom information.

It allows easier in-house customs clearance and ensures clarity for both manufacturers and retailers.

A long journey

Dell’s computers, along with Chengdu’s other products, are transported to Chengdu International Railway Port by trucks and are ready to embark on the 10,000km journey to Europe. The cargo could get fast customs clearance in the customs office next to the railway station.

Trains are cheaper than planes and faster than ships, able to reach Eurasia in 12 days. Chengdu’s is getting attention because of its efficient logistics network.

“Every week, 16 cargo trains are running between Europe and China. And more manufacturers are moving here because they believe in the future of rail transport,” Said Zhang Jing, deputy general manager of Chengdu International Railway Service.

Dell is a small example of manufacturing in China that has grown many folds over the past three decades. But new technologies, new methods of transportation, and new partners are still reshaping manufacturing.

  

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