China’s express delivery companies and their e-commerce partners have been forced by high costs to pull back from door-to-door delivery and instead ask customers to pick up their packages to keep shipment prices low and remain competitive. Taobao, the customer-to-customer online trading platform of Alibaba, launched a self-pick-up service in Hong Kong in late August, allowing consumers to choose from 200 pick-up points, including the 125 post offices in Hong Kong, for their shipment options. Picking up purchased goods instead of requesting door-to-door delivery may save consumers more than 50% in shipping costs. Delivery industry analysts feel the “self-pick-up solution” is an option Taobao and its logistics partners were forced to take. “As Taobao expands outside China, with Hong Kong as the first key overseas market, it realized managing logistics capacity is a challenge,” said Gary Ng, Chairman of the Hong Kong Courier Association. Taobao’s registered users in Hong Kong reached 1.4 million at the end of 2012, comprising almost one fifth of the city’s population. China’s express delivery companies delivered 9.2 billion pieces of goods in 2013, up 61.5% over 2012 and ranking it No 2 in terms of business volume after the United States, the South China Morning Post reported.

China will further open the domestic express delivery market to qualified foreign enterprises. The country will streamline license approval procedures and encourage mergers and acquisitions (M&As), even those launched with foreign capital, within the necessary review system. China’s international delivery business has become basically open to overseas capital, while domestic markets in major cities have gradually become available to foreign players. The enhanced competition will be an incentive for domestic companies to improve their operations and services, stimulate domestic demand and create more jobs, a government announcement said. United Parcel Service (UPS) has received licenses to operate express services in 33 Chinese cities, and 19 of these were granted this year. Apart from the two major hubs in Shanghai and Shenzhen, UPS also has about 250 operating facilities throughout China. FedEx said that it has been working closely with the relevant authorities to obtain express delivery service permits ever since the new Postal Law came into effect. According to a report released by Deloitte Touche Tohmatsu and the Development and Research Center of the State Post Bureau, 78.9% of market share is held by private companies, 19.9% by state-owned enterprises and the remaining 1.2% by foreign ones. Chu Xuejian, Vice Chairman of the Shanghai Logistics Association, said: “It is very likely that consumers will opt for Chinese companies, which charge less, when they want to deliver less important shipments but opt for foreign ones, which charge more but provide better and much safer service for important goods.”

Maritime connection projects under construction in the ASEAN region include the shipping route between Qinzhou Port in Guangxi and Kuantan Port in Malaysia, the China-ASEAN port logistics information center, and the cooperation mechanism between port cities in China and ASEAN. In terms of land transport connections, the construction of the Pan-Asia Railroad and the Nanning-Singapore Corridor are being discussed. The government of Thailand suggested two railway routes based on the current lines, one from Kunming to Bangkok and the other from Kunming to Vientiane, both of which could connect the China-ASEAN Free Trade Area with the pan-Asia region. The 3,800-km Nanning-Singapore Corridor starts from Nanning in Guangxi and runs south all the way to Singapore. The corridor covers Vietnam, Laos, Thailand and Malaysia and once complete, it will connect 1.5 billion people. Yang Xiuping, the Chinese Ambassador to ASEAN, said that logistics integration would not only improve transport but also bring people in the region together.

COSCO Shipping’s business has expanded to eight Latin American countries this year as the continent’s economy is expanding. COSCO Shipping entered Latin America in the 1960s and has now deployed 20 vessels between China and Latin America, with six ships operated on the route each month. Thanks to China’s surging vehicle trade with Venezuela, Brazil, Uruguay and Argentina in recent years, the company’s China-Latin American route has seen rapid growth in maritime vehicle transportation. Its business rose 45% year-on-year in 2013. It also delivers vehicles from South Korea and Japan to Latin America. One of COSCO’s biggest shipping assignments this year was the contract to transport more than 1,000 rail products including locomotives, trams, and freight and passenger cars to Brazil and Argentina within two years. The carrier also sealed deals to transport wind turbines, wind power systems, mechanical and electrical products, as well as construction materials for building new power plants, cement and sugar refinery factories, and other projects throughout Latin America this year.

Container ship operators from China are facing fresh pressure from the new 2M alliance between Denmark-based Maersk Line and Switzerland-based Mediterranean Shipping Co. The new grouping comes after the three-party pooling alliance P3 was turned down by the Chinese government. The two European companies signed a 10-year vessel sharing agreement earlier in July to enhance their earnings capabilities. Zhang Shouguo, Vice President of the China Shipowners’ Association, said the government had rejected the P3 alliance because it had a combined market share of about 30% of the global container shipping market. Maersk and MSC have jettisoned the French container line and formed a vessel-sharing agreement in such a way that their combined market share is below the 30% threshold. Unlike the P3 network, the 2M partnership will operate more as a vessel sharing agreement without any separate independent organizations or executive powers managing the network. The agreement doesn’t include joint marine operations. Each party will execute its own operations, including stowage, voyage planning and port operations. Maersk and MSC can also manage their sales, pricing, marketing and customer service functions independently. The 2M network includes 185 vessels with an estimated capacity of 2.1 million TEU, deployed on 21 routes on three trade lanes: Asia-Europe, trans-Pacific and trans-Atlantic. The 2M vessel-sharing agreement is expected to start in early 2015 following approval by relevant authorities.