Freight train carries China-made engines to France

[TaiShang]

Well, it is a commercial venture, I think the track switching and customs clearance are done by a consortium set up by all the countries involved with the route. If it doesn't work out, this thing will die, but apparently the usage is surging.

Yes, the European-Eurasian rail route has grew incrementally from 2013, but, especially last year there was a surge in the density.

As for cost, the rail freight business has been consolidated under (I think) China Rail Logistics and it is a state-owned company. Sure, there is the problem of track non-uniformity, but, even with that, the rail freight is way more efficient and faster than freight by sea.

Also keep in mind that most of the goods are still have to be carried by land vehicles and to be on-loaded and off-loaded even the shipping is done by sea. So, it is very simplistic to argue that sea freight is less costly.

There are so many variables and the Indian's simplistic approach does not explain it. For instance, insurance. Shipping by sea increases insurance cost, which will be reflected on the prices of the good shipped.

The rail track by itself may not make money, but, it will offer a lot of externalities in the form of faster shipping, denser trade and a lot people making a lot more money just because they do more business. These gains cannot easily be quantified.

As usual, Indians are thinking very linear and they are devoid of wholistic view.

 

[Han Patriot]

This article for example - http://www.scmp.com/week-asia/busin...g-across-one-belt-one-road-rail-route-nowhere

"Eastbound marine container rates from Europe to China shot up at the beginning of this month. The week our train left, it cost slightly more than US$1,500 to ship a 40ft container by sea from Europe to China. The cost of sending the same container by rail was quoted at US$2,500, two-thirds more expensive. The cost differential between westbound services was even wider, with sending containers from China to Europe by rail two and a half times more expensive than by sea."

"Certainly Scotch whisky, which has typically spent 10 years or more maturing in dank Highland cellars, has no great need to reach the market a couple of weeks sooner. Nor do the shoes and socks that made up much of the cargo of the first westbound rail service from China to the UK earlier this year gain anything by arriving a few days earlier at twice the cost."

Is there something that people are missing?

They were saying alot of things about Chinese ventures since the very beginning of the economic reform. Go to China and see it for yourselves.

Yes, the European-Eurasian rail route has grew incrementally from 2013, but, especially last year there was a surge in the density.

As for cost, the rail freight business has been consolidated under (I think) China Rail Logistics and it is a state-owned company. Sure, there is the problem of track non-uniformity, but, even with that, the rail freight is way more efficient and faster than freight by sea.

Also keep in mind that most of the goods are still have to be carried by land vehicles and to be on-loaded and off-loaded even the shipping is done by sea. So, it is very simplistic to argue that sea freight is less costly.

There are so many variables and the Indian's simplistic approach does not explain it. For instance, insurance. Shipping by sea increases insurance cost, which will be reflected on the prices of the good shipped.

The rail track by itself may not make money, but, it will offer a lot of externalities in the form of faster shipping, denser trade and a lot people making a lot more money just because they do more business. These gains cannot easily be quantified.

As usual, Indians are thinking very linear and they are devoid of wholistic view.

You see their way of thinking is if I don't have it, it is bad. Same as HSR, and look now they are begging for it. Let the market determine whether this venture works out. They seem to think only they have brains and other people cannot evaluate things, but in the end, you can see the Indian result vs the Chinese result.

 

[AndrewJin]

They were saying alot of things about Chinese ventures since the very beginning of the economic reform. Go to China and see it for yourselves.



You see their way of thinking is if I don't have it, it is bad. Same as HSR, and look now they are begging for it. Let the market determine whether this venture works out. They seem to think only they have brains and other people cannot evaluate things, but in the end, you can see the Indian result vs the Chinese result.

I prefer indian magic babies
we need these demoncratica trains in the world

 

[Beast]

This article for example - http://www.scmp.com/week-asia/busin...g-across-one-belt-one-road-rail-route-nowhere

"Eastbound marine container rates from Europe to China shot up at the beginning of this month. The week our train left, it cost slightly more than US$1,500 to ship a 40ft container by sea from Europe to China. The cost of sending the same container by rail was quoted at US$2,500, two-thirds more expensive. The cost differential between westbound services was even wider, with sending containers from China to Europe by rail two and a half times more expensive than by sea."

"Certainly Scotch whisky, which has typically spent 10 years or more maturing in dank Highland cellars, has no great need to reach the market a couple of weeks sooner. Nor do the shoes and socks that made up much of the cargo of the first westbound rail service from China to the UK earlier this year gain anything by arriving a few days earlier at twice the cost."

Is there something that people are missing?

These SCMP article are filled with many biased information that tells you one thing but omit the others. SCMP are still run by some anti-China hongkonger lackeys.

https://gbtimes.com/china-runs-5000-cargo-trains-on-new-silk-road-to-europe

Ordinary people do not understand the word "foresee". The west and haters use to talk about China ghost city in the past and claim they are a waste of money. Guess what happen to those ghost city?

People expect Rome to build in a day. If it can't, its a waste of money and not successful.

Freight line is a strategic option. It will ease heavy reliant on shipping lane. It will prevent global political changes to have a heavy impact on China export. Plus, train freight from China to Europe is still in infact. As more investment pour into infrastructure, the cost will slowly lower. Remember some idiot claim solar power or wind power are to expensive to replace fossil fuel or whatever blah blah blah.. Guess what, now solar power and wind is going to match fossil fuel in terms of generating electricity. It is no more a pipe dream. All thanks to more investment, more usage and buyers. Prices will be lower down. If we goes by those idiot theory. As long as no money is made, anything shall be stopped.

These layman mentality is just like those petty investor who cannot see long term growth but only aim for short dividend and stock rise. If a company spend money on research, its bad. A company that sells off all its strategic asset and lay off many workers to boast just a single year earning , it will be good. It looks good for a single year profit but for next ten years , it will be doomed.

Do you want to become Warren buffet or just a petty investor? I think I do not need to say more.

 

[Martian2]

This article for example - http://www.scmp.com/week-asia/busin...g-across-one-belt-one-road-rail-route-nowhere

"Eastbound marine container rates from Europe to China shot up at the beginning of this month. The week our train left, it cost slightly more than US$1,500 to ship a 40ft container by sea from Europe to China. The cost of sending the same container by rail was quoted at US$2,500, two-thirds more expensive. The cost differential between westbound services was even wider, with sending containers from China to Europe by rail two and a half times more expensive than by sea."

"Certainly Scotch whisky, which has typically spent 10 years or more maturing in dank Highland cellars, has no great need to reach the market a couple of weeks sooner. Nor do the shoes and socks that made up much of the cargo of the first westbound rail service from China to the UK earlier this year gain anything by arriving a few days earlier at twice the cost."

Is there something that people are missing?

The train tracks linking China to Europe are not primarily for the transportation of Chinese goods to Europe.

The countries that are part of the transport route between China and Europe paid for those upgraded or new train tracks. The primary purpose of the railway is to provide transportation for those countries. Additionally, it is to provide freight service for those countries.

The passage of Chinese trains to Europe is meant to supplement the income of the countries in the BRI (Belt and Road Initiative). The participating countries can collect transit fees from Chinese transport countries using the China-Europe railway.

The China-Europe trains are useful for shipping high-value goods like car engines. Other items include electronics (such as Huawei smartphones or mobile-phone base stations), semiconductors (computer chips), notebook computers, desktop computers, etc.

In conclusion, the China-Europe railway is a bonus to the primary purpose of modernizing the participating-countries' infrastructure. Those countries need a modern railway system to develop their own countries and economies. To determine the economic viability of the China-Europe railway involves an analysis of the benefits to the domestic economies of participating countries. Those countries have decided it is a project that they wanted to be involved in and they have taken the risk that China-Europe railway (passenger and cargo) traffic will increase over the next 30 years to make it profitable.

 

[Martian2]

The China-Europe railway is part of the Belt and Road Initiative (BRI). Participation in China's BRI program brings many benefits.

1. BRI countries are eligible for low-interest Chinese Friendship Project loans of 2%.
2. The new or upgraded railway serves the domestic people-transportation and freight-transportation of the participating country.
3. BRI countries want to use the railway network to sell their goods into the vast Chinese $12 trillion market.
4. BRI countries want to attract Chinese tourists, who are the world's largest-spenders at an average of US$900 per overseas trip.
5. BRI countries want to attract Chinese foreign investment. Some countries (like ASEAN) already have a free-trade-agreement with China. By setting up SEZs (special economic zones) along a BRI railway, Chinese companies would be tempted to set up automated manufacturing plants in a low-tax country.
6. BRI countries want an inexpensive transportation method to send students and business-people to China. The only way to upgrade your country's technology is to interact with China.
7. BRI countries can earn money from transhipment fees for cargo trains.
8. The total repayment period (after factoring in the grace period) is about 30 years for a Chinese Friendship Project loan. In thirty years, the volume of domestic passengers, domestic freight, Chinese tourists, goods shipment into China, FDI in new SEZs, people-interaction with China, and transhipment fees could rise dramatically.

In conclusion, transhipment fees from China-Europe cargo trains are only a minor consideration in the construction of the China-Europe railway. There are far more important business considerations, which I have enumerated.

 

[TaiShang]

The China-Europe railway is part of the Belt and Road Initiative (BRI). Participation in China's BRI program brings many benefits.

1. BRI countries are eligible for low-interest Chinese Friendship Project loans of 2%.
2. The new or upgraded railway serves the domestic people-transportation and freight-transportation of the participating country.
3. BRI countries want to use the railway network to sell their goods into the vast Chinese $12 trillion market.
4. BRI countries want to attract Chinese tourists, who are the world's largest-spenders at an average of US$900 per overseas trip.
5. BRI countries want to attract Chinese foreign investment. Some countries (like ASEAN) already have a free-trade-agreement with China. By setting up SEZs (special economic zones) along a BRI railway, Chinese companies would be tempted to set up automated manufacturing plants in a low-tax country.
6. BRI countries want an inexpensive transportation method to send students and business-people to China. The only way to upgrade your country's technology is to interact with China.
7. BRI countries can earn money from transhipment fees for cargo trains.
8. The total repayment period (after factoring in the grace period) is about 30 years for a Chinese Friendship Project loan. In thirty years, the volume of domestic passengers, domestic freight, Chinese tourists, goods shipment into China, FDI in new SEZs, people-interaction with China, and transhipment fees could rise dramatically.

In conclusion, transhipment fees from China-Europe cargo trains are only a minor consideration in the construction of the China-Europe railway. There are far more important business considerations, which I have enumerated.

Yes, the socio-economic benefits of the greater connectivity cannot simply be reduced to the cost of initial investment or freight. The BRI is an all-around project that aims closer connectivity and communication of all sorts. Rail transport is one of them. Another means of communication is power grid. China has some big plans on that plane, too, regarding SEA, Central Asia and NEA.

 

[Realtalk108]

Yes, the European-Eurasian rail route has grew incrementally from 2013, but, especially last year there was a surge in the density.

As for cost, the rail freight business has been consolidated under (I think) China Rail Logistics and it is a state-owned company. Sure, there is the problem of track non-uniformity, but, even with that, the rail freight is way more efficient and faster than freight by sea.

Also keep in mind that most of the goods are still have to be carried by land vehicles and to be on-loaded and off-loaded even the shipping is done by sea. So, it is very simplistic to argue that sea freight is less costly.

There are so many variables and the Indian's simplistic approach does not explain it. For instance, insurance. Shipping by sea increases insurance cost, which will be reflected on the prices of the good shipped.

The rail track by itself may not make money, but, it will offer a lot of externalities in the form of faster shipping, denser trade and a lot people making a lot more money just because they do more business. These gains cannot easily be quantified.

As usual, Indians are thinking very linear and they are devoid of wholistic view.

These SCMP article are filled with many biased information that tells you one thing but omit the others. SCMP are still run by some anti-China hongkonger lackeys.

https://gbtimes.com/china-runs-5000-cargo-trains-on-new-silk-road-to-europe

Ordinary people do not understand the word "foresee". The west and haters use to talk about China ghost city in the past and claim they are a waste of money. Guess what happen to those ghost city?

People expect Rome to build in a day. If it can't, its a waste of money and not successful.

Freight line is a strategic option. It will ease heavy reliant on shipping lane. It will prevent global political changes to have a heavy impact on China export. Plus, train freight from China to Europe is still in infact. As more investment pour into infrastructure, the cost will slowly lower. Remember some idiot claim solar power or wind power are to expensive to replace fossil fuel or whatever blah blah blah.. Guess what, now solar power and wind is going to match fossil fuel in terms of generating electricity. It is no more a pipe dream. All thanks to more investment, more usage and buyers. Prices will be lower down. If we goes by those idiot theory. As long as no money is made, anything shall be stopped.

These layman mentality is just like those petty investor who cannot see long term growth but only aim for short dividend and stock rise. If a company spend money on research, its bad. A company that sells off all its strategic asset and lay off many workers to boast just a single year earning , it will be good. It looks good for a single year profit but for next ten years , it will be doomed.

Do you want to become Warren buffet or just a petty investor? I think I do not need to say more.

The train tracks linking China to Europe are not primarily for the transportation of Chinese goods to Europe.

The countries that are part of the transport route between China and Europe paid for those upgraded or new train tracks. The primary purpose of the railway is to provide transportation for those countries. Additionally, it is to provide freight service for those countries.

The passage of Chinese trains to Europe is meant to supplement the income of the countries in the BRI (Belt and Road Initiative). The participating countries can collect transit fees from Chinese transport countries using the China-Europe railway.

The China-Europe trains are useful for shipping high-value goods like car engines. Other items include electronics (such as Huawei smartphones or mobile-phone base stations), semiconductors (computer chips), notebook computers, desktop computers, etc.

In conclusion, the China-Europe railway is a bonus to the primary purpose of modernizing the participating-countries' infrastructure. Those countries need a modern railway system to develop their own countries and economies. To determine the economic viability of the China-Europe railway involves an analysis of the benefits to the domestic economies of participating countries. Those countries have decided it is a project that they wanted to be involved in and they have taken the risk that China-Europe railway (passenger and cargo) traffic will increase over the next 30 years to make it profitable.

Thanks for the clarification. I think I get it now. The primary purpose is to provide a trade conduit (subsidized if necessary) between China and central Asia. Reaching Europe is secondary.

 

[TaiShang]

Thanks for the clarification. I think I get it now. The primary purpose is to provide a trade conduit (subsidized if necessary) between China and central Asia. Reaching Europe is secondary.

Actually, reaching Europe is primary. Currently there are nearly 20 rail links with various Western Europe cities. The links naturally go through CA and Russia.

The big market is naturally Europe.

 

[Han Patriot]

Actually, reaching Europe is primary. Currently there are nearly 20 rail links with various Western Europe cities. The links naturally go through CA and Russia.

The big market is naturally Europe.

They will never get it. If they get it, India will not be India.

 

[TaiShang]

They will never get it. If they get it, India will not be India.

They differently have a different mindset and way of looking at tings. That's fine and, perhaps, normal. The problem arises when they reveal the specific thinking patterns in international forums in an imposing way. I am sure, they are getting by very well when they talk to each other.

Our way of thinking and logic patterns must look strange them, as well.

The real problem is when they make value judgment, rather than just showing an honest wonder to learn and understand. On our side, we avoid making value judgment; I always hold that if people are happy with what they have, who am I to judge them based on my own particular socio-cultural experience.

We need value-free understanding of each other; without judging from a high moral ground and without making any insinuations.

 

[Realtalk108]

Actually, reaching Europe is primary. Currently there are nearly 20 rail links with various Western Europe cities. The links naturally go through CA and Russia.

The big market is naturally Europe.

The rail makes sense when shipping goods between Western China/CA/East Europe. But from the coastal areas? I don't think it will go beyond high value items.

There is also the geostrategic factor. A land route bypassing SCS may come in handy. But such a scenario where China's sea trade routes are blocked is very unlikely to happen.

 

[Adam WANG SHANGHAI MEGA]

I have been told that the train route is economically unviable, and exists only due to huge subsidies.

Is that true? I am not able to find the report where I read this.

they said and so did a lot of.Chineses when the CHINA Beijing to.shanghai high speed line starting.its construction,but see now even my grandma see this as a miracle come ture,it used to take 12 hours to get to my city now only 4 hours!
THANKS TO CPC!

 

[TaiShang]

The rail makes sense when shipping goods between Western China/CA/East Europe. But from the coastal areas? I don't think it will go beyond high value items.

Whatever can be exported, will be exported, I guess. China has major industrial clusters in various regions although there may be concentrations in the Eastern and Central regions. Besides, it is a trade route, not an export route. Hence, trans-shipment hubs such as Yiwu receive and send various goods on daily basis.

There is also the geostrategic factor. A land route bypassing SCS may come in handy. But such a scenario where China's sea trade routes are blocked is very unlikely to happen.

It is not to by-pass SCS trade route as it does not make sense. Who in their sane mind would threaten China's trade security? So, you are right, it is unlikely.

The point of the Eurasian route is to increase trade and connectivity and bring once-ignored inland areas into global development.