Beijing 2008 Olympic Games Logistics News Update. Schenker China Ltd. Beijing Branch June 01 st, 2008
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1 Beijing 2008 Olympic Games Logistics News Update Schenker China Ltd. Beijing Branch June 01 st, 2008
2 Agenda A Olympic Locations B Expected Restrictions C Schenker s Contingencies 2 Schenker China Ltd. Beijing Branch, 01. June 2008
3 Olympics Venues in Beijing The main locations are within the 6 th ring road of Beijing The BDA* will experience impact Especially companies based around the fifth ring road will be effected by the traffic regulations *) BDA Business development area Beijing a concentrated area of companies 3 Schenker China Ltd. Beijing Branch, 01. June 2008
4 2008 Non BEIJING Olympic Venues Besides Beijing there will be Olympics activities in Venues Location Shenyang Qinhuangdao Tianjin Qingdao Shanghai Hong Kong Football Preliminary Football Preliminary Football Preliminary Sailing Football Preliminary Equestrian Hong Kong and Qingdao will have the biggest portion of the non-beijing Olympics activities 4 Schenker China Ltd. Beijing Branch, 01. June 2008
5 Agenda A Olympic Locations B Expected Restrictions C Schenker s Contingencies 5 Schenker China Ltd. Beijing Branch, 01. June 2008
6 Olympic effects on logistics in greater Beijing There are major impacts on transportation start on June 01 st Expected / possible areas of limitation Trucking during day time after July 01st 2008 General transport limitations Enforcement of individual s holiday during Olympics Energy and industrial production Dangerous Goods Restrictions July 20 th Sep. 20 th odd/even number plate regulation No day-time trucking June July August September July 01 st begin of traffic control period (yellow/green) July 25 th - Sep25 th implementation of Olympic Express Lane Olympics Aug 08 th Aug 24 th Paralympics Sep 06 th Sep 17 th July September expected period of industrial restrictions (pollution prevention) 6 Schenker China Ltd. Beijing Branch, 01. June 2008
7 Olympic Lanes in Beijing Even the sixth ring road is effected by Olympic regulations Olympic Lanes at present Chang An Street Second Ring Rd. Third Ring Rd. Forth Ring Rd. Fifth Ring Rd. The north-eastern part of the 6 th ring road will also be subject to the traffic controlled area BDA downtown traffic is heavily effected BDA Beijing airport traffic is impacted by 5 th and 6 th ring regulation BDA Tianjin traffic will also be impacted due to expected traffic jams Olympic lanes are exclusive tracks on the respective major roads that are reserved for vehicles with a special Olympic related license (VP/VAPP) 7 Schenker China Ltd. Beijing Branch, 01. June 2008
8 Traffic restrictions after July 01 st 2008 Overview of three major areas of traffic restrictions in Beijing Green / Yellow Government Measures starting July 2008 Odd / Even VAPP / Olympic Lanes Starts July 01 st All Vehicles Except Vehicle Pass holders (Olympic purposes only) Starts July 20 th All Passenger Vehicles Except Passenger vehicles >22 seats Starts July 25 th Only VP holders can use Olympic lane Potential impacts to our customers may lead to procurement/production of buffer stock Limited staff commuting Limited production supply Limited order fulfillment 8 Schenker China Ltd. Beijing Branch, 01. June 2008
9 Traffic restrictions after July 01 st 2008 Overview of operation hours / areas for trucks in Beijing area* 00.00h 05.00h Operational limitations Beijing registered trucks with EURO III No Use of Olympic Lanes Non Beijing registered trucks with EURO II Must register on check point outside Beijing No Use of Olympic Lanes Must leave Beijing area after 72h 00.00h 24.00h Operational limitations Trucks with Vehicle Permit VP Use of Olympic Lanes (<4tons) Olympics purposes only *) Beijing area is expected to be enforced in a 50km diameter of city center 9 Schenker China Ltd. Beijing Branch, 01. June 2008
10 Traffic restrictions after July 01 st 2008 Several rules may apply (green/yellow) BEIJING VEHICLES Government Measures for Beijing registered vehicles Trucks Trucks are considered as vehicle with loading space 2tons class is expected to be restricted (i.e Jinbei Light Truck)* Registered trucks have already passed an emission inspection Yellow labels will strictly block the use of the car within the stated period Trucks can only operate between 00.00h and 05.00h Passenger Cars Registered cars have already passed an emission inspection Yellow labels will strictly block the use of the car within the stated period Passenger vehicles with +22 seats are not subject to limitation NO YES *) Not confirmed yet 10 Schenker China Ltd. Beijing Branch, 01. June 2008
11 Traffic during day time after July 01 st 2008 Several restrictions may apply (green/yellow) Entering Beijing Government measures for vehicle checks entering Beijing (not official) Trucks can only operate between 00.00h-05.00h It is expected that the checkpoints for inbound traffic are outside the city limits The checkpoints are said to be positioned in a 50km radius Check point locations uncertain ( ) Tianjin Express Way checkpoint is planned to be operating in Langfang area Location of other check points is uncertain NO 50km YES 11 Schenker China Ltd. Beijing Branch, 01. June 2008
12 Traffic during day time after July 01 st 2008 Several restrictions may apply (green/yellow) NON-BEIJING VEHICLES Government Measures for Non-Beijing registered vehicles Trucks Trucks are considered as vehicle with loading space 2tons class is expected to be restricted (i.e Jinbei Light Truck)* Registered trucks must pass an emission inspection to achieve Euro II Trucks that pass the inspection are allowed to operate 72hours in Beijing Yellow labels will strictly block the use of the car within the stated period Trucks can only operate between 00.00h-05.00h Passenger Cars Vehicles must pass an emission inspection to achieve Euro II Yellow labels will strictly block the use of the car within the stated period Passenger vehicles with +22 seats are not subject to limitation Application and enforcement process Emission application and inspection process unclear NO YES 12 Schenker China Ltd. Beijing Branch, 01. June 2008
13 Traffic during day time after July 20 th 2008 Several restrictions may apply (odd/even) Government Measures starting July 2008 Number Plate regulations (Odd/even plate) will start on July 20 th Odd/Even only applies to passenger vehicles and vehicles with VP Control period from July 20 th to Sep 20 th Daily traffic is subject to odd and even number plates inside the 6 th Ring Rd. Olympic Venue areas along the 6 th Ring Rd. are effected, too (Venues outside the fifth ring road are in the North and East of Beijing no exact information available yet) Passenger vehicles (>22seats) are not subject to odd/even plate regulation Non-Beijing passenger vehicles Applies as above + Vehicle inspection restrictions (Green/Yellow plate) 13 Schenker China Ltd. Beijing Branch, 01. June 2008
14 Traffic during day time after July 28 th 2008 Several restrictions may apply (VAPP) Government Measures starting July 2008 Vehicle Accreditation and Parking Permit (VAPP or VP) Vehicles with VP have unlimited mobility These vehicles can use the Olympic lane, too (<4tons vehicles only) VAPPs are limited to Olympic related transportation purposes Non-Beijing vehicles Applies as above 14 Schenker China Ltd. Beijing Branch, 01. June 2008
15 Air traffic limitations Air freight capacities might be limited during Olympic games Capacity situation starting June 2008 Capacity Additional security checks for export cargo will increase lead times by 48h Pure freighter services are expected to be put on hold during Olympics Increasing passenger volumes might influence lower deck capacities Additional recommendations to customers Re-arranging dispatch of goods to late hours (00:00-05:00) may provide additional security Reconsider contracted lead-times due to additional time requirements for possible security checks 15 Schenker China Ltd. Beijing Branch, 01. June 2008
16 Olympic effects on logistics in greater Beijing Further measures may affect the neighboring provinces Options to reduce industrial related pollution A shut down of certain companies is said to be last from July 20 th until September 20 th The shutdown within a 200km zone has major influence on industrial production and supply for the region The area is within the vicinity of 200km around Beijing (Tianjin, Tangshan, Baoding and other significant locations will experience impacts on their industrial production) That area might be extended in case of less effectiveness up to 300km (Qinhuangdao, Shijiazhuang, Datong, Dezhou, Dongying) 200km zone 300km zone 16 Schenker China Ltd. Beijing Branch, 01. June 2008
17 Additional government regulative options No hazardous material from June 01 st to October 01 st 2008 During the control period dangerous goods most probably cannot be shipped through Beijing Hong Kong Shanghai Shenyang Tianjin Qingdao Qinhuangdao It generally applies to dangerous goods class 1-8 Port/Airport authorities and shipping/air lines have partly published the applicable rules Once identified the material could be hold at the port/airport in respective dangerous goods warehouse facilities High storage charges are expected Hazmat Classes 17 Schenker China Ltd. Beijing Branch, 01. June 2008
18 Additional HAZ MAT regulations Different rules may apply according to carriers announcements DG Restriction by Carriers in China Last update : 29 May :00 Note : Please always check with local carriers for any change. Restriction in place DG Class No restrictions (so far) Airlines Eff. Date Impact Air China Cargo (PG1), 6.2 (Cat A) 14-Apr-08 All Destinations in China Cathay Pacific Cargo (PG1), 6.2 (Cat A) 5-May-08 To/From/Transit Beijing Shipping Lines Chinese Shipping UN 1090, 1091 ACIDS (see comment) See comment Jun 01st - Sep 30th All Destinations in China Except HK Evergreen Immediate All Destinations in China Sinokor Merchant Marine Jul 20th - Aug 31st All Destinations in China CMA CGM UN 1090 ACIDS Jun 01st - Aug 31st All Destinations in China COSCO UN 0222 UN , PG1 & PG2 Immediate All Destinations in China ACIDS UN1831, 2796, 1830, 1832, 2031, 2032, 1789 Ammonium nitrates & related fertilizers (UN2067, 2071, 2212, 2315, 3151, 3152 etc) Hyundai Maritme China Jul 20th - Aug 31st All Destinations in China APL No formal announcement yet. But do not provide quotation to all DG cargos. Immediate All Destinations in China CSAV Restriction in place. But no formal release to external parties Immediate All Destinations in China Maersk, CSCL, ZIM, MSC, Hanjin No formal announcement yet. But will review the order case by case. Immediate All Destinations in China 18 Schenker China Ltd. Beijing Branch, 01. June 2008
19 Additional government regulative options Effects to economic and political life June July August September Additional regulative measures (not confirmed) Energy Supply To enhance environmental situation there might be a reduced energy supply for certain parts of Beijing. (Under extreme weather conditions, the government announced to take further actions to enhance the quality of the air). Power stations west of Beijing may reduce the production to lower emission Lower output may affect Beijing industrial performance All major constructions in greater Beijing will be cut off July 20 th Enforcements on population To reduce risk in traffic / public situations there might be additional measures by the government to announce public holidays Strict security check regulations for inbound trains to Beijing Additional security checks on Beijing express ways Access control to Beijing Evacuation of non-beijing Chinese citizens to other provinces 19 Schenker China Ltd. Beijing Branch, 01. June 2008
20 Additional government regulative options Potential shut down of companies from July 20 th to September 20 th Potential Company list 首钢总公司 Shougang Group 北京东方石化有限公司东方石化厂 Beijing Eastern Petrochemical Co.Ltd 北京首钢红冶钢厂 Beijing Shougang Hongye Steel Co., Ltd 北京平板玻璃集团公司 Beijing Flat Glass Group 北京首钢股份有限公司第一线材厂 Beijing Shougang Co.Ltd First Electricity Line Factory 北京秦昌玻璃有限公司 Beijing Qingchang Glass Co., Ltd 北京鹿牌都市生活用品有限公司 Beijing LuPai Daily Necessities Company 北京昌平区南口玻璃瓶厂 Beijing Changpinnankou Glass Bottle Factory 北京首钢吉泰安合金材料有限公司 Beijing Shougang Jitaian Alloy Co., Ltd 北新集团建材股份有限公司 Beixin Construction Material Company 北京市西六工贸公司 Beijing Xiliu Trade Company 北京市翔牌墙体材料有限公司 Beijng Jiangxiang Wall Material Co., Ltd 北京首钢建材化工厂 中国南车集团北京二七车辆厂 中国北车集团北京二七机车厂 北京首钢第二耐火材料厂 北京首钢康宏带钢厂 The Steel Factory of Beijing Shougang Group 北京兴民玻璃制品厂 Beijing Xinming Glass Material Factory. 北京方瑞铸造有限公司 Beijing FangRui Foundry Co., Ltd 北京菲美特协力铸造有限公司 Beijing Feimeite Foundry Co., Ltd 北京燕山石化集团 Beijing Yanshang Petrochemical Group 北京京能热电公司 Beijing Jingneng Thermoelectricity Co., Ltd 大唐北京高井热电厂 Datang Beijing Gaojing Thermoelectricity Co., Ltd 华能北京热电公司 Huaneng Beijing Thermoelectricity Co., Ltd 国华北京热电分公司 Guohua Beijing Thermoelectricity Co., Ltd Beijing Shougang Construction Material Chemical actoryl Beijing 207 Vehicle Factory of China South Vehicle Group Beijing 207 Locomotive Factory of China North Vehicle Group The 2nd Fireproof Material Company of Beijing Shougang Remarks: These companies need to meet the pollution emission standard and then further reduced 30% of their emissions. If the standard can t be reached, these companies will be shut down. (measures are uncertain at this moment as well as additional companies that might be added) 20 Schenker China Ltd. Beijing Branch, 01. June 2008
21 Agenda A Olympic Locations B Expected Restrictions C Schenker s Contingencies 21 Schenker China Ltd. Beijing Branch, 01. June 2008
22 Dangerous Goods No hazardous material from June 01 st to October 01 st 2008 During the control period dangerous goods cannot be shipped through: Beijing, Hong Kong, Shanghai, Shenyang, Tianjin, Qingdao, Qinhuangdao Schenker provides additional routings / services through Yantai to Beijing On-carriage will be organized by overland transportation Schenker Contingency Measures* Additional recommendations to customers Re-schedule dispatch of dangerous goods after October 01 st 22 Schenker China Ltd. Beijing Branch, 01. June 2008
23 Dangerous Goods There might be additional airfreight options available Schenker Contingency Measures* At this moment no HAZMAT restrictions are known through Yantai Yantai port/airport might be considered as a contingency option for restricted cargo (but no airfreight cargo aircraft only ) 23 Schenker China Ltd. Beijing Branch, 01. June 2008
24 Trucking Schenker can operate normal during Olympics Schenker Contingency Measures* Schenker trucks are inspected according to government regulations Schenker increases its subcontracted fleet to avoid odd/even constraints Schenker recommends its customers to reschedule deliveries to time windows when restrictions are not applicable Additional recommendations to customers Re-arranging dispatch of goods to late hours (00:00-05:00) may provide additional security *) current status of official information April / May Schenker China Ltd. Beijing Branch, 01. June 2008
25 Trucking and Milk-Runs Schenker provides pick-up and delivery options for Beijing Schenker Contingency Measures Buffer warehouse capacity at Beijing (TAPA-certified) to cover both production supply and finished goods Customers already have made use of Schenker s contingency measures PICK UP IN BEIJING Pick up from customer during night time with authorized vehicles Transport to Schenker buffer warehouse outside restricted area Delivery h MILK RUN / TRUCKING OPERATIONS Consolidate goods in contingency warehouse Truck to Tianjin via Langfang with Beijing registered trucks Deliver at Port/Airport/Customer and pickup cargo for Beijing Pickup h 6 th RING km 25 Schenker China Ltd. Beijing Branch, 01. June 2008
26 Airfreight through Tianjin (1) Airfreight can be rerouted through Tianjin Schenker Contingency Measures (non hazmat) Operational switch to alternative Schenker operational capacities Pick up from factory / or Schenker buffer warehouse (see previous slide) Build pallets at Schenker Beijing and bonded trucking to Tianjin Use of existing and upcoming scheduled air freight operations ex TSN including trucking feeder service ex Beijing Operate additional charter flights ex TSN on several airlines* based on existing operations for high tech industry Provide buffer warehouse space in TSN Additional recommendations to customers Re-consider lead times as such cannot be guaranteed as during normal season *) SU, RU, CA, MP, LH, etc. 1week pre notice required 26 Schenker China Ltd. Beijing Branch, 01. June 2008
27 Airfreight through Tianjin (2) Additional airfreight options / schedules Additional Flight Capacities ex Tianjin during Olympic Season / (non hazmat) Destination AMS Amsterdam (NL) ICN Incheon / Seoul (KR) Airline Flt/Week Equipment Ops Start GW Great Wall 3 B 747 April 2008 CZ China Southern 7 B 747 June 2008 GS Grand Star 4 B 747 April 2008 FRA Frankfurt (DE) JI Jade Cargo 3 B 747 April 2008 VI Volga-Dnepr 1 B 747 April 2008 KUL Kuala Lumpur (MY) MAN Manchester (UK) OSA Osaka (JP) AK Air Asia 4 A 330 June 2008 GW Great Wall 2 B 747 April 2008 CZ China Southern 7 B 747 June 2008 Schenker offices in Beijing and Tianjin are in close contact with airlines to ensure additional capacities 27 Schenker China Ltd. Beijing Branch, 01. June 2008
28 Sea Air Solutions via Tianjin Schenker provides regular services through South Korea Schenker Contingency Measures Use of existing scheduled Sea-Air freight operations ex TSN i.e. via ICN Additional Sea-Air options are available through Qingdao and Dalian Dangerous goods can only use non Olympic gateways (Dalian, Yantai, etc.) Additional recommendations to customers Re-consider lead times as such cannot be guaranteed as during normal season 28 Schenker China Ltd. Beijing Branch, 01. June 2008
29 Rail Road Air Option Alternative routing through Urumqi Schenker Contingency Measures Use of existing Road / Rail Air solutions via Urumqi (URC) / Inner Mongolia to many destinations Add 4-6days to general lead times Additional recommendations to customers Re-consider lead times as such cannot be guaranteed as during regular season 29 Schenker China Ltd. Beijing Branch, 01. June 2008
30 Overland Transportations Network Based on established routings alternative transport routes can be used Schenker Contingency Measures Alternative routings to avoid Beijing congestion threat Pre-carriage to surrounding Ports/Airports Long-distance trucking to Central and South China Additional recommendations to customers Re-consider lead times as such cannot be guaranteed as if during regular season 30 Schenker China Ltd. Beijing Branch, 01. June 2008
31 Beijing 2008 Olympic Games Logistics News Update The next update will follow mid June 2008 For amendments of the mailing addresses please contact 31 Schenker China Ltd. Beijing Branch, 01. June 2008
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