Chinese carmakers look to own ro-ro capacity | News


Chinese electric car maker BYD is reportedly on order for at least six car carriers because it can’t get enough space for its logistics service provider. Each ship can carry over 7,000 Vehicle Equivalent Units (CEUs).

While waiting for that capacity, automakers have been considering alternative options, including shipping electric trucks by bulk ships. China DailyA news source said in December that BYD will export 240 pure electric trucks to Chennai, India at the port of Shanghai, due to a shortage of dedicated capacity onboard Pure Car and Truck Carriers (PCTC). It was reported to have been loaded onto a bulk carrier.

Rival Chinese automakers Chery International and JAC are also taking steps to secure ro-ro capabilities in their joint ventures with Anhui Port and Shipping Group. The joint venture, called Anhui Hangrui International Ro-Ro Transportation Company, will also engage in international container transportation, freight forwarding and supply chain services. Seatrade Maritime News.

underinvestment
From mid-2022 onwards, it’s easy to see why export capacity for finished vehicles is tightening. Assembly plants have gradually increased production after the COVID-19 pandemic subsided, but ships discarded or laid up by ro-ro operators during the pandemic have not been replaced. A complete car logistics provider was cautious about placing new orders for vessels (with significant lead times) given market uncertainty. That underinvestment has resulted in a capacity crunch that has pushed up rates for both ro-ro and con-ro vessels.

This coincides with the lifting of COVID-19 measures in China and greater efforts by Chinese EV makers to export their brands to international markets. EV production costs are lower in China, making them more competitive with Western brands even after considering export costs. That said, the US and EU are likely to raise import duties on these vehicles to protect local production.

Global ocean logistics provider Wallenius Wilhelmsen has admitted that overall vessel capacity will be tight in 2022. In a statement released on its website in January this year, Eric Sorum, head of the company’s global market insight team, said the tightening was expected to continue. Solum said only 11 of her vessels are scheduled for delivery in 2023, which is expected to have a minor impact on general capacity.

“My talented and smart colleagues are always on the lookout for how ships are stacked to optimize capacity while maintaining safe transportation and proper cargo spacing, which are the most important issues. Therefore, it is important for our customers to take a longer-term view than usual when planning their logistics,” says Solum.

That’s not to say more ships aren’t being built. However, even if all the ro-ro ships scheduled for delivery in 2023 are delivered, they will not be able to meet the demand for large shipments from China. The Chinese market is set to export 2.3 million units of her to Europe this year, but her RO-RO capacity currently expected in 2023 can supply only half that number. This has prompted automakers to plan for the long term to avoid future disruptions. Meanwhile, they are also looking to ship containerized vehicles. auto logistics I will report on the details next week.



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