Guaranteed Next Day deliveries to China

US package delivery group,FedEx, is to launch next-day deliveries within China (guaranteed) for the first time in May, highlighting the increasing sophistication of transportation and logistics services in the country.

The group will offer time-definite overnight deliveries to 19 of China’s biggest cities and day-definite deliveries to more than 200. Read original article

Customers will receive a refund if deliveries are not made by the guaranteed time – an entitlement US and European businesses have been accustomed to for years.

The launch signals FedEx's confidence that Chinese transportation infrastructure has become reliable enough to support a high-speed delivery network.

It also reflects a shift by international transportation and logistics companies towards the Chinese domestic market after years spent focused on Chinese exports.

UPS, the largest US package delivery group, and German-owned DHL are also developing domestic express networks in China.

DHL announced plans last month to invest $110m to expand its Chinese business over next few years, in addition to the nearly $1bn it has already invested in the Greater China region.

Eddy Chan, senior vice president of FedEx in China, said 90 per cent of the group's existing Chinese customers had expressed the need for a reliable domestic express service.

"This is a strong signal to us that many companies view domestic express service in China as a catalyst for growth and competitiveness," he said.

The service will be operated in partnership with Okay Airways, a Chinese airline, and centred around a newly-built package sorting hub at Hangzhou Xiaoshan airport in Zhejiang Province.

Michael Ducker, president of FedEx's international operations, said the new service was aimed at both multinational companies operating in China and domestic businesses.

The group was seeking to "capitalise on China's transition to a consumer economy through its rapidly growing middle class," he said.

FedEx last year paid $400m to take full control of its Chinese joint venture with Tianjin Datian W. Group.

The acquisition allowed FedEx to fully integrate its Chinese assets, including nearly 90 parcel-handling facilities and a 3,000-strong workforce, into its international network.

The group is also planning to move its main Asian international air hub from the Philippines to the Chinese city of Guangzhou.

UPS expects to break ground this year on a new Chinese air hub in Shanghai.

Growth in express delivery services has been an important factor in the increasing speed and efficiency of corporate supply chains in developed countries over recent years.