China Railway Corp. to Fight Slump in Profits by Building Rail Logistics Centers
China Railway Corp., the country’s railway service provider is fighting a huge slump in profits and is now planning to build a number of rail logistics centers in Shandong and Anhui provinces to support transportation of household appliances and help in diversifying its business. The new logistics centers will be established in the home appliances producing areas Hefei and Wuhu in Anhui once the CRC seals the deal with Qingdao based Haier Group.
Based on the deal China Railway Corp. provides designated freight trains and tailored multi modal logistics services for Haier in order to help the company with their domestic and international rail deliveries. China Railway Corp. is also talking with Hisense another Qingdao based home appliance manufacturer in handling thier rail deliveries as well. From January to September last year CRC reported their sales at 657 billion yuan with profit down 174 percent year on year. the company said their losses were mainly from fast growing road transportation and a decline in rail goods transportation. Before products were transported by road, but through the cooperation with CRC they connected several road and railway transportation as a whole and provided consumers with an integrated delivery service.
Haier hopes that in analyzing a better way to provide better logistics service with CRC, which includes computerization of transportation and warehouse management and mechanization. The collaboration with Haier goes further between transportation and manufacturing enterprises and focuses on user experience. based on a statement from the assistant director of All View Cloud, a Beijing based consultancy firm that specialize in home appliances said that Haier can reduce its logistics costs and transport their goods to destinations quickly the using China Railway Corp. transportation advantages.