Cainiao begins Zhengzhou-Budapest service on e-commerce surge

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Surging e-commerce growth between China and Eastern Europe has led Cainiao Smart Logistics Network to launch its first direct cargo flight between Zhengzhou (CGO) and Budapest (BUD).

The logistics arm of Alibaba Group Holding says it is expecting 30 per cent growth in its cross-border e-commerce volume between China and Eastern Europe by the end of 2021.

The five times a week flight is able to transport up to 17 tonnes of goods per day, and customers in Eastern Europe will be able to receive their parcels from China as soon as 10 days.

As one of Cainiao’s fastest-growing markets, Eastern Europe, especially key markets such as Hungary and Poland, has witnessed a booming demand from local consumers purchasing items such as fashion, home appliances and electronic accessories from China.

In the first quarter of this year, the trade volume between China and 17 Central and Eastern European countries reached USD30.13 billion, a year-on-year increase of 50.2 per cent, which was 11 percentage points higher than the growth rate of China’s foreign trade in the same period.

Through an extension of its logistics network in key markets of Western Europe, Cainiao’s trucking network has now expanded to cover 10 countries in Eastern Europe, directly transporting Chinese goods after they arrive at the Budapest Airport.

This is realised with local partners such as Hungarian Post and Polish Post. The overall delivery time and expenses are reduced by 20 and 5.0 per cent respectively.

In collaboration with the local customs bureau and logistics partners, Cainiao says it has developed a digitalised customs clearance system that processes very large amounts of information, such as orders and payments, to digitalised data.

Through this process, customs clearance can be completed even before the flight lands, Cainiao says. The new system has shortened the average offline clearance time of 1-2 days to an average of six hours, making Hungary the first country in Eastern Europe to be equipped with a digitalised customs clearance system.

“The cooperation with Cainiao is a significant milestone for the Budapest Airport,” says Chris Dinsdale, CEO of Budapest Airport. “We are committed to elevating the bilateral trade between the two countries, making Budapest an important cargo hub gateway for Central and Eastern Europe,” he says. This will be accomplished by leveraging the country’s unique strategic location and Cainiao’s global parcel network, he adds.

William Xiong, Cainiao’s chief strategist and general manager of Export Logistics comments: “Hungary has a strategic geographical advantage in Eastern Europe. Cainiao’s parcel volume to the region in April rocketed 53.7 per cent compared to the same period last year.

“We are committed to improving the efficiency of international transportation between China, and Central and Eastern Europe, as well as building digitalised logistics infrastructure and services with our local partners.”

Xiong says he expects that Cainiao’s USD5.0 for 10-day delivery service will be available in Central and Eastern European countries soon. At present, this delivery service covers Spain, France, the Netherlands, Belgium, the United Kingdom, Germany, Portugal and other European countries, with expectations to cover over 10 more countries globally this year.

As of March 2021, Cainiao processes more than 5.0 million cross-border parcels per day.

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