The Chinese government and several states have been subsidizing rail service from China to Europe. A phase-out is planned for 2023 now. Subsidies were supposed to end in 2022 but an extension was made for COVID.
There are various claims of inflating the amount of traffic.
Rates from Europe to China, the return trip, have been low, so that empty containers get returned to China. In fact, they are set at less than cost; around $100 per container, while the real cost is around $3000 to move an empty container.
But with container rates sky-high now and so many blank sailings from Asia by container liners, the rail service rates have been very high to Europe. Perhaps a subsidy is no longer needed. We’ll see.
Quality of service will be the main determinant of the success of this route in the long run. And we will see if the various countries on the route can figure out how to cooperate over the long run to get total rail shipment times down.
By Sam Whelan 20/12/2021It’ll be ‘quality not quantity’ on China-Europe rail services as subsidies fade – The Loadstar