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China's logistics development trends and requirements for road transport vehicles
Mr. Wang Ming, Deputy Director of the Institute of Comprehensive Transportation under the National Development and Reform Commission and Vice President of the China Logistics Institute.
**I. Current Status of Logistics Development in China**
1. The Eleventh Five-Year Plan marked a significant step in the development of logistics in China. It emphasized the growth of the modern logistics industry by promoting advanced logistics management techniques. This included internalizing corporate logistics functions, streamlining operations such as procurement, production, sales, and resource recycling. The plan also aimed to foster specialized logistics companies and expand third-party logistics services. In addition, it focused on building a standardization system, investing in new technologies, and advancing the informatization of logistics. Infrastructure integration was also prioritized, with the construction of large logistics hubs and regional centers.
For the first time, key issues such as the application of management technology, market demand cultivation, enterprise development, informatization, standardization, and infrastructure were clearly defined. These efforts have played a crucial role in shaping the direction of China’s modern logistics development.
2. **Current Situation of China's Logistics Industry**
(1) With rapid growth in social logistics demand, the ratio of total logistics costs to GDP has steadily declined, while the value added by the logistics sector has increased.
(2) A surge in logistics companies has led to innovative developments in logistics management and service models.
(3) Enterprises in manufacturing and commerce have adopted modern logistics concepts, optimizing their internal logistics and driving resource integration and changes in growth patterns.
(4) Significant progress has been made in logistics infrastructure and technology, improving overall logistics conditions.
(5) The acceleration of logistics informatization has greatly contributed to the modernization of the logistics industry.
(6) Basic logistics work has seen progress, and the industry is gradually gaining momentum.
3. **Challenges in the Logistics Sector**
Despite these advancements, several challenges remain. The level of logistics service organization and operational intensity is still low. Logistics infrastructure remains weak, and the distribution and organization of logistics are not yet optimal. Additionally, the technological equipment used in logistics, particularly freight vehicles, lags behind global standards. The policy framework is also incomplete, hindering further development.
4. **Understanding Modern Logistics**
(1) The essence of modern logistics lies in three key areas: reducing costs through improved management and professional services, enhancing efficiency via optimized logistics organization and technology, and improving service quality through better supply chain management and innovation.
(2) From the perspective of logistics activities, it involves managing the procurement of raw materials, inventory of semi-finished and finished products, transportation, warehousing, distribution, and packaging.
(3) When viewed from the angle of resource integration, logistics entails reorganizing warehouses, transport facilities, human resources, and other assets for more efficient use.
(4) Information services play a critical role in logistics, supporting decision-making for production planning, inventory control, and product distribution.
(5) From a financial standpoint, logistics is a value-adding activity that reduces costs, enables zero inventory, optimizes capital flow, and ultimately enhances business profitability.
**II. China’s Logistics Planning During the Eleventh Five-Year Period**
1. **Guiding Principles**
The development of logistics should be guided by the scientific outlook on development, with a market-driven approach, enterprise-centered strategies, and reform and opening-up as key drivers. Advanced technology and high-quality services should be the foundation for creating a favorable policy environment. By integrating existing resources and developing new infrastructure, a multi-economy logistics system will be established, aiming to reduce costs, improve service quality, and support industrial upgrades and economic coordination.
2. **Basic Principles**
Clarity on service roles, alignment with national strategies, market-based resource allocation, and government-led environmental creation are essential. Emphasis should be placed on overall planning, coordinated development, breaking down barriers, and fostering sustainable innovation.
3. **Development Goals**
By 2010, China aims to establish a fast, efficient, safe, and internationally competitive modern logistics system. The goal is to significantly enhance the socialization, professionalization, and modernization of logistics. Third-party logistics should account for around 10% of the market, and the cost-to-GDP ratio of total logistics should decrease by 2–3%.
4. **Key Tasks for Modern Logistics Development**
These include encouraging enterprises to outsource logistics, accelerating the development of professional logistics firms, leveraging information technology, establishing standardization systems, upgrading logistics equipment, cultivating the logistics market, expanding international logistics, and improving the handling of bulk and special commodities.
5. **Key Projects**
Projects include infrastructure development, demonstration programs for logistics modernization, major commodity system upgrades, public information platforms, pallet-sharing systems, emergency logistics, basic industry work, and the construction of an integrated transportation system.
**III. Vehicle Requirements for China’s Logistics Development**
1. **Transportation Operation Requirements**
Logistics requires reliable, efficient, and safe transportation solutions. Key requirements include cost control, time efficiency, capacity, safety, reliability, availability, network convenience, and accurate information. High-quality vehicles, especially those replacing outdated road transport units, are essential.
2. **Concepts for Transportation Development**
It is necessary to shift management approaches, reform economic structures, adjust transport industries strategically, improve technological content, and implement policies that promote sustainable growth and the integration of modern logistics.
3. **Vehicle Requirements**
Mainline transport vehicles should be large-scale, containerized, and specialized, with high-quality design. Urban distribution vehicles must be compact and environmentally friendly, meeting the needs of city logistics efficiently and sustainably.