Project Title: Emergence of a new Logistic Alternative- The Asia Europe Land Bridge. Date: 15 October Presented by: Darryl Hadaway

Transcription

1 Project Title: Emergence of a new Logistic Alternative- The Asia Europe Land Bridge Date: 15 October 2015 Presented by: Darryl Hadaway

2 A picture says a thousand words

3 Talking points: Like the internet changed commerce- e- commerce - the new Silk Way economic belt is and will provide shippers with radical changes in logistics efficiency between Asia, Europe and Middle East What s there today? Role of the Silk Route Rail- as an Independent Commercial Block Train Carrier Time, quality and economics of Rail Issues and why this makes sense!

4 Changing the logistics model- The New Silk Way days transit time vs days by sea 5-7 times more cost-effective than air freight Flexibility of proximity to shipper/ customer Faster supply chain greatly improves cash flow through inventory savings Solution for temperature sensitive goods through investment in 45 Reefer containers Year-round solution bearing in mind that temperature on the route drops to below minus 50 Celsius in winter months even goods which are normally looked at as general cargo may need temperature control Ecologically good option

5 A user view of the Silk Way- HP- Creation of distribution center in Khorgos for further export to Russia, Europe, China, Central Asia, Turkey and Persian Gulf St. Petersburg Moscow Hamburg TERMINAL (Consolidation) Brest Ileck ASTANA Antwerpen Aksaraiskaya SEZ KHORGOS (Consolidation/ distribution) Dostyk Aktau Almaty Istanbul Baku Tehran Gorgan Sarahs Khorgos Urumqi TERMINAL (Consolidation) Xian TERMINAL (Consolidation) TERMINAL (Consolidation) Lianyungang TERMINAL (Consolidation) Chengdu Chongqing Wuhan Shanghai Bandar Abbas Abu Dhabi Dubai Guangzhou Shenzhen Hong Kong

6 Dynamics of the routes: Characteristics of rail movements Block train to Middle East /Turkey Chongqing-Duisburg Rail (approx 11,179 klms) Time days Cost 8,000 Distance Transit time Ocean day 2,000 Chongqing Khorgos Jezkazgan Baku - Poti ~ KM days Ocean Air 25 24,500 Rail air ,000 Chongqing Khorgos Jezkagan Baku - Istanbul ~ KM days Air 1 day 40,000 Lianyungang Khorgos Jezkagan - Iran ~ KM days

7 Main Routes: Chongqing to Duisburg Chengdu to Lodz Wuhan to Hamburg Zhengzhou to Hamburg Others starting but tend not to be regular Operators Generally multiple operators and interests on China and Europe side. Some key names include KTZE, RZD, Inter Rail, UTLC, TEL, Yuxinou, FELB Our aim is eventually have a service from every province in China using Khorgos as the main hub to Middle East, Central Asia and Europe.

8 Why SRR believes in its future: - Independence and private sector - Collaboration model- addressing the interest of all parties in the Silk Route - Largely separated from changes in governments and potential conflicts - Control over containers and particularly focus on acquiring control over a significant number of reefer containers for the expected trade types and addressing the extreme variations on Silk Route temperatures - Ensuring latest in use of technologies for tracking and tracing - Independence, reliable, transparent and credible management of the service to the international freight forwarding community The company is seeking to raise capital for the development and implementation of the service with the first trains scheduled to start in late fourth quarter in 2015

9 Time- quality- economics: Transit times: Current Chongqing to Duisburg according to HP is 11.5 days. (With technology changes- this is expected to decrease further to 10 days) Other Western Chinese cities days Europe to China days

10 Time- quality- economics: Quality: The Rail story- started with access On going significant infrastructure build and innovations The Partners to manage- eg KTZ/ DP World Containers/ Wagons

11 Time- quality- economics: Economics: Rail is largely not competing with ocean but air. It is estimated that rail will take less than 1% from ocean but as much as 10% from airfreight. The electronic companies saves approx. US$30,000 per 40 container from Western China to Germany. Many markets open to trade due to distance from the ocean locations Consider total cost- holding/ cash flow/ working capital investment

12 Rail size Issues- but being worked at and solutions emerging: One route.one stakeholder? Well it s new - ADB ownership - regulations (view of what can be moved; customs) - collaboration is key! Security and safety Unit 45 Reefer containers Variations of temperature Availability of right assets and services Rail changes and ongoing innovation Security- Globe Tracker Cost issues - subsidies - awareness of cost - two way traffic

13 Contact details: Silk Route Rail Limited Web: Darryl Hadaway Chief Executive Officer Tel: Henrik Christensen Advisor to CEO and Board Tel: