Neele-Vat sets up Chinese forwarding company

The overheated container market in China has prompted Rotterdam-based Neele-Vat to become active in the People’s Republic itself. Together with its German partner Dörrenhaus, the Rotterdam-based company quietly established the Chinese freight forwarding company NVD Asia last year to gain more control over the shipment of cargo from China to Europe by sea, air, and rail. The two parties have acquired a majority stake. The local management holds the remaining shares.

Neele-Vat has hit the ground running in China, as the new booking office headquartered in Hong Kong got off to a flying start late last year with eight branches and 120 employees. In addition, there are already concrete plans to open branches in Vietnam, Taiwan and Cambodia.

Managing Director Cuno Vat would have preferred to keep the Chinese initiative under wraps a little longer, but due to the 50th anniversary of the German partner—in which Neele-Vat holds a minority stake—news of the Asian initiative leaked out after all.

Point of contact

The immediate reason for the joint venture is to be able to respond quickly to problems through the on-site procurement office and to have a central point of contact. Especially with the pandemic, strict quarantine regulations and the large capacity shortage, this is worth its weight in gold, Vat said. For example, the company has already chartered its own aircraft and handled large cargo flows toward Europe via the New Silk Road to get shipments to customers on time.

With its own offices, Neele-Vat can also respond much faster to logistical bottlenecks in Chinese seaports, says Vat. 'Delays, adjustments and cancellations are commonplace and then it is good that we can switch quickly locally.' In addition, over the past two years the number of administrative operations in the Chinese container market has increased significantly. The time to get a shipping container this way has multiplied in two years. 'With its own office and its own IT, the chain becomes more transparent and communication is improved.' In doing so, NVD Asia does not want to be a foreign company in China, but an Asian forwarder with Western European management, Vat says.

NVD Asia team

Neutral platform

NVD Asia does not operate exclusively for the two major European shareholders. Quite the contrary, in fact. The forwarding company is a neutral platform mainly for smaller agents who do not have their own offices in China. 'There are currently about a hundred forwarders already using NVD Asia,' states Vat. Of the 10,000 teu per month that the subsidiary already ships, the bulk comes from these customers.

Individually, these freight forwarders have too little cargo volume and therefore insufficient bargaining power to negotiate favorable rates with Shipping lines; however, by pooling their resources through NVD Asia, they can leverage the larger volume and thus compete on price with the larger freight forwarders, according to Vat.

The new company's estimated annual container volume is 100,000 to 150,000 sea containers, says partner Lars Dörrenhaus. And 3,000 will be handled by rail. That volume will increase by 10 to 20% annually, according to Cuno Vat.

source: News Sheet Transport