Asia-Europe rail shippers Czech out Prague for savings

Asia-Europe rail shippers Czech out Prague for savings

Asia-Europe rail services have been expanding to keep up with growing demand.

Asia-Europe rail shippers needing to reach Austria, Romania, and Hungary can save up to five hours of transit time and 1,300 to 1,500 euro per container by offloading cargo in Prague, Czech Republic, rather than Germany.

More than 75 percent of Asia-Europe rail cargo ends its transcontinental journey in Germany, according to statistics from the Russian Ministry of Transportation. Cargo usually reaches its final destination via trucking, which is where the transit time and cost savings are found.

For example, the distance between Prague, Czech Republic, and Vienna, Austria, is estimated at about 293 kilometers (182 miles), compared with more than 600 km in the case of transportation from Berlin. From Prague to Budapest, Hungary, is only 524 km and five hours, compared with nine hours and 872 km to reach Budapest from Berlin. Shippers can save between 1,300 and 1,500 euro per container on both routes.

Additionally, offloading for distribution in the Czech Republic offers shippers greater access to the markets of Croatia, Austria, and Italy, while offloading in Germany is best for accessing markets in Belgium, the Netherlands, and France.

Shippers can take advantage of these savings via the new Asia-Europe routings with a service by UTLC, an intermodal rail operator active in Russia, Belarus, and Kazakhstan that said it is interested in developing more routes connecting Central Asia to the Czech Republic.

The first train terminating in Prague left the Chinese city of Yiwu on July 19 and regular services will begin in November, according to Maria Teterina, corporate affairs director of UTLC.

The new service will have an annual capacity of 100,000 TEU and the company plans increase capacity to 300,000 TEU by 2020, said analysts at the Russian Ministry of Transport.  Demand for China-Europe rail that passes through Russia will continue to grow until at least 2022, according to the Russian Ministry of Transport.

That is because the Trans-Siberian Railway Line’s capacity of 450,000 to 500,000 TEU annually is nearly quadruple the capacity of the alternative Baku-Tbilisi-Kars rail route. The Trans-Siberian also has faster transit times because the distance is shorter, while Baku-Tbilisi-Kars trains must be broken down and rebuilt at each border crossing because of different track gauges. The Trans-Siberian routing also benefits from cargo having to pass through just two customs regimes, uniform weighting requirements, and the absence of ferry crossings.

Using the Baku-Tbilisi-Kars route to reach Germany is about 1,000 km longer than the Trans-Siberian route, with a cost of $8,000 to $8,500 per container and a transit time of 16 to 17 days.

The Trans-Siberian costs between $6,000 and $7,000 per container with a transit time of 10 to 12 days.

Contact Eugene Gerden at gerden.eug@gmail.com.