News / Cosco's car shipping unit hooks up with PWL for European expansion

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COSCO Shipping Car Carrier (CSCC) has ventured into the European automotive logistics market, after signing a collaboration agreement with German logistics group PWL Shipping on Wednesday.

The COSCO group’s automobile shipping unit, which was established in August 2022, has ordered 24 pure car and truck carriers since its incorporation, and has ambitions of global expansion.

CSCC and PWL have pledged to provide automotive logistics and other value-added services in Europe. PWL’s automotive logistics unit, LPL Automotive, specialises in shipping vehicles between North America and Europe, especially car imports from the US, on both PCTCs and in containers.

PWL can also ship cars from Europe to China, collecting cars across Europe using special trucks, and shipping the vehicles from its terminal in Bremerhaven.

China Association of Automobile Manufacturers’ statistics show that from January to April, 1.37m automobiles were exported, up 89% year-on-year. Notably, exports of new energy vehicles nearly doubled to 348,000 units, and Europe is a key destination of these vehicles. Last year, China exported 3.11m cars, surpassing Germany to become the world’s second-largest car exporter after Japan.

CSCC said: “With growing demand for China-Europe shipments, we have adjusted our capacity allocation. We plan to further expand our European routes in H2 23.”

CSCC said that since its establishment, it has completed two China-Europe shipments, carrying 6,765 commercial vehicles of various types, including new energy vehicles.

The Loadstar has recently reported on the surge in vehicle shipments, which has seen a large number of cars backlogged in European ports, such as Antwerp-Bruges.

At the same time, there are inadequate in-service PCTCs to meet the rebound in vehicle demand.

Last month, ship broker Clarksons noted that PCTC charter rates have reached a record high of $110,000/day.

During the Covid-19 pandemic, there was under-investment in PCTC newbuildings, as movement restrictions slashed demand for new vehicles, resulting in many older PCTCs being scrapped.

Last year, 90 PCTCs of 560,000 ceu were ordered, nearly tripling the 38 commissioned in 2021. During the height of the pandemic in 2020, just four PCTCs were ordered. In 2023 to date, 25 PCTCs have been contracted.

According to CSCC’s business plan, its newbuilds are scheduled for delivery between 2024 and 2026, enabling the company to carry 700,000 vehicles annually. By then, CSCC targets to complete three to four China-Europe shipments monthly.