YRC Makes a Move

Wednesday, June 27, 2007 10:00
Posted in category China Logistics, Invest in China
Comments Off on YRC Makes a Move

On April 3, Bill Zolliers spoke to members of a JP Morgan audience about their plans in China (see YRC Has Plans For China) where he said that YRC was looking to make two acquisitions by year end.

I took that to mean that they were already in final phases… and apparently, in at least one case they were.

Today YRC announced that they were buying Shanghai Jiayu Logistics,

one of the largest providers of less-than-truckload ground transportation services in China, with over 30,000 customers, 1,600 employees, 300 tractors and a network of over 3,000 vehicles.

According to Zolliers:

“Initially this acquisition will allow us to build a service network that will provide greater reliability for our customers as they move shipments within China as well as provide seamless, end-to-end service for international movement in the critical U.S.-China trade lane”

An interesting acquisition, and strong pick up for sure, this move will defiantly support their growth plans in China.. which already includes the purchases of JHJ International (long haul logistics provider) and partnership with JinJiang’s airfreight unit. (According to Reuters YRC Logistics’ China sales in 2006 were $350 million, accounting for 35 percent of global sales)

My only question (at this point), is how many of the advertised 3000 vehicles, and overall network, are the property of Jiayu vs. the property of other logitics carriers who they have partnerships with.

for those of us on the ground (see post later this week), FedEx has made similarly strong moves, but unlike YRC.. FedEx has been very vocal about their moves. It has been interesting that 18 months after the JHJ acquisition, little of YRC has been seen in the market openly… but I guess with 350 million in revenues, they are doing just fine without making a big splash (something tells me GM and Walmart are keeping them busy).

As someone who worked previously in the States in the logistics industry, and found it to be a .. uh. unexciting.. china is different. Whether it is purchasing real estate, buying up trucks, planning distribution center, or buying into existing networks.. the logistics industry is one on the move.

and I am sure that someone else in the market will make their moves known soon enough.. hmm. Who will be next?

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