Chongqing - The New International Land-Sea Trade Corridor (ILSTC) is revolutionizing trade routes, connecting China with Southeast Asia and Europe. Along with the China Railway Express to Europe, this corridor strengthens industrial ties between these regions and stabilizes China’s supply chains. 

In the first half of this year, Chongqing's trade with the EU exceeded 49 billion yuan (about 6.86 billion U.S. dollars), making Europe the city's second-largest trade partner after ASEAN.

Chongqing International Logistics Hub Park, a bustling scene at the Xinglongchang Marshalling Station. (Photo/Long Fan and Xie Zhiqiang, Visual Chongqing)

Challenges with traditional trade routes

On June 28, a freight train departed from Chongqing's Tuanjiecun Station, heading to Qinzhou Port. It was loaded with 1,056 automotive brackets produced by Chongqing Boao Magnesium Aluminum Manufacturing Co., Ltd., destined for Germany's Dräxlmaier Group, a leading global auto parts supplier serving major automotive brands like Audi, BMW, and Mercedes-Benz.

Qin Xianyue, Vice General Manager of Operations at Boao, highlighted the ILSTC’s crucial role in maintaining their European partnerships. “The ILSTC rail-sea intermodal train saved us 13 days, reducing costs and securing our European orders,” Qin stated.

The need for a more reliable logistics solution became apparent in March 2021, when the “Ever Given” vessel blocked the Suez Canal, causing global trade disruptions. Although Boao’s products weren’t on the ship, other vessels carrying their goods were delayed, threatening their ability to deliver on time—a key factor in maintaining client trust.

With airfreight for a batch of auto brackets costing 600,000 yuan, far exceeding the product value of 190,000 yuan, Boao had to reroute ships around the Cape of Good Hope, adding 15 days and increasing costs. This incident underscored the broader logistical challenges in traditional maritime routes.

ILSTC provides a more reliable trade solution

As Middle East instability extended the maritime route from China to Germany from 40 to 55 days, Boao turned to the ILSTC for a more dependable logistics solution. 

Previously, Boao’s products traveled from Chongqing’s Cuntan Port along the Yangtze River, taking 25 days to reach Shanghai’s Yangshan Port. The entire process took 80 days, matching delivery periods and increasing risks.

In contrast, the ILSTC’s rail-sea intermodal train dramatically reduced transit times. Starting from Chongqing’s Tuanjiecun Station, the journey to Qinzhou Port now takes just three days. Even after accounting for additional time spent loading the goods onto ships at Qinzhou, the total logistics time doesn’t exceed 12 days. This change has provided Boao with a 13-day buffer period, significantly easing the pressure on their delivery schedule.

The ILSTC not only offers faster transit times but also does so at a competitive cost, making it an increasingly attractive option for companies like Boao. In 2023, Boao shipped 60 TEUs via ILSTC, valued at 14 million yuan, boosting their confidence in expanding in Europe.

Growth in European markets

Reduced logistics risks have helped Boao's growth in European markets. This year, their magnesium alloy auto brackets entered the supply chains of Volkswagen and Mercedes-Benz in Germany.

Boao’s products are favored in Germany due to their light weight, strength, and better shock absorption than traditional materials like aluminum and steel. As the auto industry shifts toward lighter materials, Boao’s magnesium alloy parts have become highly sought after.

Boao’s parent company also has extensive magnesium reserves, ensuring a steady supply, while its deep processing capabilities have achieved global standards. In June 2023, it collaborated with Chongqing University to produce the world’s largest magnesium alloy automotive die-cast component, marking a significant milestone.

Boao is also collaborating with companies like Changan Automobile and Seres to innovate in magnesium alloy auto parts. It aims to lead the global magnesium industry and contribute to the lightweight manufacturing trend in automotive production worldwide.

(The Chinese version of this report was contributed by Tang Qin, Yang Jun, and Ren Meilian, reporters from Chongqing Daily, and Li Hao, an intern from Chongqing Daily.)