[photopress:autoplant.jpg,full,alignright]The logistics problems facing the automotive industry in China are the same as in the rest of China’s logistics industry: an infrastructure shortage, a skills gap, problems with joint ventures, high transport costs, IT problems and below world standard levels of service.
At the recent Shanghai conference on automotive logistics the consensus was that if the market keeps growing the logistics framework — both within China and between China and its markets — will need to make a big effort to match global standards.
Louis Diebold, a former senior officer in the US Foreign and Commercial Service, said: ‘The key to success in China is really in the logistics sector. Although huge logistics challenges remain, improvements come every day. In the early 80s, there were no imports and no market competition. Everything was distributed by the government. There were hardly any cars, people were still using bicycles. Things started to change in 1985 when Volkswagen came to Shanghai with its first joint venture.’
That foreign companies need to become, or at least act like a Chinese company, was a recurrent message throughout the conference. The often stated opinion was that this means foreign companies need to find their way around red tape and if necessary partner with the right Chinese company as a joint venture.
Source: CargoNews Asia.