IMO 2020 and its impact on sea freight transportation

COVID-19: updates on DACHSER’s operations in China and Korea

We would like to inform you about the latest update on the market situations and current status of DACHSER’s operations in China and South Korea.

China

All DACHSER branches in China are open except Wuhan. Starting from March 2, most branches are operating with full teams, but the operations are not resuming to full capacity, as the local market conditions are still very challenging with shortage of labor and traffic controls. Domestic trucking remains a major issue.

General status in China

Factories are slowly picking up with their productions. Compared with last week, more factories have resumed work, but production is not up to 100% normal, while some of the factories are either still closed or operating with skeleton staffing. Generally, all businesses are gradually resuming. In many locations, authorities only allow a limited number of staff to enter the premises to prevent workplace infection. Therefore, most of the enterprises are operating with skeleton staffing, and have part of their employees working from home, if applicable. Employees who returned from the Hubei province are required to stay in quarantine for 14 days before returning to workplace. This quarantine restriction also applies to truck drivers.

DACHSER branches in China

• All DACHSER branches except Wuhan are open and resumed business. Wuhan is closed until further notice.
• A few DACHSER branches are operating with skeleton staffing due to local authorities’ preventive measures.
• Employees, if not in the office, are working from home to keep the operations ongoing.
• There are delays in some processes, as most of the units in the supply chain within China are not functioning in full capacity.

Transport logistics in China

While we are trying our best to keep your supply chain as smooth as possible, please consider that other units in the supply chain did not resume full capacity yet. Carriers and terminals are gradually resuming operations with skeleton staff. Delays and other operational issues are expected.

Road:

• Lack of truckers is currently the major issue in China.
• Inter-cities and inter-provinces trucking are especially challenging due to heavy regulations on road, making road journeys heavily delayed.

Railway:

• Rail carriers resumed to work from March except Wuhan and Yiwu, total capacity is higher compared with February.
• Rail terminals are operating (except Wuhan) overtime to achieve higher volume of container handling.
• Customs are operating except Wuhan.
• FCL service on pre/on-carriage has resumed.
• FTL service is available.
• LTL service is available for some districts.

Air:

• Airlines increased freighters from China as factories has gradually resuming production.
• Capacity is still an issue since many of the airlines suspended passenger flights.
• It is expected that space will get tighter towards end of March as factories production is ramping up.

Sea:

• Shortage of truckers and equipment
• Carriers have reduced sailings to and from China.
• Westbound: Cargo volume is recovering as more factories are resuming production; backlog is expected once the factories are fully operative, leading to shortage of truckers and space.
• Eastbound: Intense space shortage
• Ocean terminals are operating, except Wuhan.

South Korea

Overall, the factories are open and operating normally except in Daegu where some factories are closed because their staff was infected with the virus. Business are mostly not affected, some enterprises including some of the carriers are having special working arrangement such as implementing flexible working hours or allowing staff to work from home.

DACHSER branches in South Korea

All DACHSER branches in Korea are currently open. To protect the safety of our staff, employees are asked to work from home whenever applicable. The operations teams are working on shift in the office at flexible hours to keep our service delays to minimal.

Transport logistics in South Korea

Air:

• Intra-Asian flag carriers have suspended passenger flights to and from South Korea. Therefore more than 50% of the capacity is reduced.

Sea:

• Currently there are no major impacts except blank sailing.

Domestic trucking:

• Minor delays for pick-up and delivery especially to and from Daegu due to road restrictions and preventive measures, no major issues at other places with in South Korea.

 At DACHSER, we have contingency measures in place and will offer you the best alternative solutions to keep your supply chain running in case any shipment is affected. We will keep our customers updated with the latest information on the current situation. Should you have any concerns and/or queries, please feel free to contact your local DACHSER representative.

The groupage of the seas

Brexit-Update: What you need to know

While the trade negotiations between the UK and the European Union continue to make slow progress, the month of June provided the last opportunity for the British government to extend the transitional period, which is currently limited to 31 December 2020. With no request for extension having been made, the focus is now on a gradual introduction of customs controls in the United Kingdom from January 1, 2021. The transition period is designed to allow traders to recover from the effects of COVID-19 and prepare for the new requirements. The United Kingdom will be subject to full customs control at its borders by 1 July 2021.

Earlier this year, the UK government took steps to eliminate certain customs facilitations, including the Transitional Simplified Procedures (TSP) and the Import VAT (PVA) shift. However, the British government has recognized that customs relief will also be necessary, at least temporarily, on January 1, 2021.

Thus, the possibility of shifting the import turnover tax is to be reintroduced. In addition, for a transitional period, there will be a customs procedure which will allow the imported goods to be declared by entering them in the accounts within a period of six months, rather than immediately upon importation. This procedure is called "Deferred Declaration".

An EU summit meeting for final talks between Great Britain and the EU will take place from 17 to 18 October 2020. Finally, on 19 October 2020 the results of a "deal or no-deal" scenario should be available. 

Regardless of the outcome of the talks, it is expected that from January 2021 onwards all goods exported to and from the UK will require tariff treatment, albeit during the transitional period described above as part of a process graduated by product group.

The following link will take you to a tool that outlines the required measures: https://www.gov.uk/transition

The UK government has also published details of preparation as an importer and exporter from/to the UK, which can be viewed via the links below: 

https://www.gov.uk/prepare-to-import-to-great-britain-from-january-2021

https://www.gov.uk/prepare-to-export-from-great-britain-from-january-2021

Further information can be found in the download document below.

If you have any further questions, please do not hesitate to contact your local contact at the relevant DACHSER branch.

Coronavirus pandemic: Impact on operational processing in the USA

As can already be seen from various press releases, the US authorities have enforced a ban with effect from 13 March 2020, 23:59 h, which prevents all entries from Europe into the United States, in addition to the already existing entry ban for visitors from several Asian countries.

This leads to a large number of flight cancellations on routes between Europe and the United States. However, the affected passenger routes also represent a significant portion of the available cargo capacity and therefore there is a massive impact on available cargo space and freight rates.

Our team of experts continues to work hard on alternative options and routes that will allow us to carry urgent cargo and we are committed to providing our customers with priority access to available capacity. As with the successful implementation of our charter program between China and Germany, we are now exploring similar solutions for transportation between Germany and the USA.

Our teams around the world will stay in touch with you, but please do not hesitate to get in touch with your contact at the respective DACHSER branch to discuss your particular situation and make further arrangements for your freight shipments.