Adjustment of the positioning of Sino Japanese relations, further adjustment of cross-border logistics pressure for large equipment

Japan plans to downgrade the positioning of Sino Japanese relations, coupled with erroneous remarks related to Taiwan, which will lead to a tightening of bilateral relations and directly spread to the fields of economy, trade, and logistics. Large engineering equipment such as rotary drilling rigs and pile drivers have become one of the most significant categories affected by fluctuations in bilateral relations due to their high value, long transportation links, and high requirements for customs clearance coordination. The cost, timeliness, compliance, and market demand of cross-border transportation between China and Japan are facing new uncertainties, and the industry needs to quickly adapt to the new logistics landscape brought about by geopolitical changes.

Customs clearance and supervision are becoming stricter, and the efficiency of cross-border equipment circulation is declining

After the adjustment of the positioning of Sino Japanese relations, the inspection intensity and compliance review of large equipment by both sides' customs have become stricter, and the clearance cycle of rotary drilling rigs, pile drivers, and core components has been significantly extended. The tightening of processes such as over limit transportation permits, equipment certification verification, and origin verification has caused obstacles to the smooth cross-border flow, resulting in longer waiting times for some equipment in transit, directly affecting the construction progress and equipment delivery performance of infrastructure projects.

The transportation cost is rising, and the pressure on logistics operations is significantly increasing

The rise in geopolitical risks has pushed up shipping insurance rates and capacity premiums, and the comprehensive cost of transporting large equipment between China and Japan continues to rise. The allocation of transportation capacity for heavy lift ships and roll on/roll off ships responsible for the transportation of rotary drilling rigs and pile drivers has become more cautious. War risk and political risk surcharges have increased simultaneously, coupled with adjustments in port operating costs. The cross-border transportation cost of a single large equipment has significantly increased compared to before, compressing the profit margins of equipment exporters and logistics companies.

Market demand is shrinking, and cross-border transportation orders for equipment are under pressure

The tightening of bilateral economic and trade atmosphere has led to a cooling of Japan's willingness to purchase Chinese rotary drilling rigs and pile drivers in the infrastructure and engineering fields, and a temporary decrease in China's export transportation orders for large equipment to Japan. At the same time, Japan's trend towards diversified trade has intensified, with some equipment import demand shifting towards European and American suppliers, further weakening the logistics demand for large-scale equipment between China and Japan. The utilization rate of dedicated line transportation capacity has decreased, and the operational stability of logistics enterprises has been impacted.

Compliance risks are increasing, and transportation plans need to be comprehensively restructured

The weakening of political mutual trust between China and Japan has brought more compliance uncertainty, and the transportation of large equipment faces multiple risks such as technical standards, trade policies, and export controls. Key components such as the power system of the rotary drilling rig and the control module of the pile driver may face stricter regulatory scrutiny, and the original fixed transportation routes and cooperation models are no longer applicable. Logistics companies need to re plan their routes, optimize their customs clearance plans, and strengthen risk management to cope with the complex compliance environment.

The industry is shifting towards diversified layout to hedge the risk of bilateral logistics fluctuations

Faced with the logistics challenges brought about by the adjustment of Sino Japanese relations, China's large-scale equipment logistics industry is accelerating its diversified market layout. On the one hand, we will deepen our cultivation in emerging markets such as Southeast Asia, the Middle East, and Latin America, and shift our demand for transportation to Japan; On the other hand, we will optimize multimodal transportation solutions such as the China Europe freight train and the new land sea corridor, improve the modular transportation and cross-border coordination efficiency of rotary drilling rigs and pile drivers, reduce dependence on single bilateral routes, and respond to geopolitical fluctuations with a resilient supply chain.