Diesel Consumption Increases as E-commerce Businesses Orders More Trucks
Diesel fuel found a new and unexpected ally in the growing legion of delivery trucks that is spawned by the rapid expanding e-commerce thus stalling any drop in the consumption of diesel fuel as the economy has shifted its focus away from manufacturing. Considered a sign of China’s migration to a service based economy coming from an industrial powerhouse and the demand for diesel that is used to power machinery and fuel trucks, generate electricity was flat this year.
Economic restructuring led to several predictions that consumption of diesel is going to peak soon and with e-commerce deliver trucks will pick up the slack as diesel use will be seen until 2020. The soaring e-commerce growth spurred surprise strength in diesel demand for this year which offset the weakness coming from the industrial and manufacturing sector. As of the moment e-commerce growth has overtaken the US as the biggest market ad is expanding 25 percent a year or about 4.5 trillion yuan by 2017.
Cashing in the growing demand for delivery trucks, the e-commerce logistic and transport service increased the number of their trucks with Yuantong Express in the top four which added 300 trucks in 2014 and bring its total to 3,000 all running on diesel fuel. Te company is expected their shipment to increase 30 to 40 million packages during the biggest online shopping sale that happens on November 11 or Singles Day, the Chinese version to Valentine’s day.
JD.com is also expanding its truck fleet up by threefold over the past two years and its targeting to have 1,000 trucks by next year.