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DSV update concerning the effects of COVID-19 on operations and supply chains

An update on how the quickly evolving situation may affect our operations.

Our 21 branches in China, Hong Kong and Macau are open and operational. The situation in Wuhan and the Hubei province is improving and we expect a gradual resumption of DSV’s operations in Hubei.

Activity levels in China are almost back to normal with Hubei ending travel restrictions on 25 March and Wuhan expected to lift the outbound ban on 8 April. While our teams all over China work hard to cater to our customers’ transportation needs, we remain strongly committed to the safety of our employees and operate under strict observance of local rules and regulations.

The DSV Executive Crisis Board monitors the situation very closely, aligns with both local authorities and international organizations (such as the WHO) and provides all employees and relevant operating units with the necessary information.

Air freight

As factories have been gradually resuming production, the demand for shipping has seen a sharp increase in recent weeks, especially the air freight market where capacity is getting more and more scarce due to lockdowns and quarantine measures in many countries around the globe. Scheduled passenger flights are cut by almost 90% while some are being transformed into pax-freighters to make up for belly capacity loss.

As a consequence of the COVID-19 pandemic, China is currently experiencing an extreme surge in exports of medical products, with governments, NGOs and private companies all increasingly sourcing PPE Products (Personal Protective Equipment) from Chinese manufacturers.

The urgency of the situation and the limited market capacity has triggered a somewhat chaotic increase in Air Charter flights involving a wide range of freighters, converted passenger aircrafts and military airplanes. Over the last days, DSV Shanghai Airfreight Team has handled a wide variety of airplanes such as 747s, Antonov-124, Ilyushin Il-76 and one Airforce A-400. Currently +30 charter flights are scheduled for the month of April and our team works around the clock to support our customers' efforts.

The demand for airfreight solutions in the coming period will continue to see an upturn, which we are accommodating with our scheduled freighter programmes and blocked space agreements with partner airlines to cover all regions involved. To mitigate the capacity shortage led by the flight cancellations, DSV has launched the Oriental Dixie service, a special charter service where space is 100% DSV controlled, to cater to the need for export from Shanghai to the US and with connections to Mexico/Latam. DSV Help, a direct non-stop Shanghai-Barcelona (in 14 hours) air bridge is available for transporting much needed medical supplies to Europe. Exports of certain commodities, such as masks and goggles, from China to Hong Kong are subject to regulations by China customs. In case you have any questions regarding the latest transportation restrictions, please kindly reach out to our local representatives.

We encourage our customers to provide demand forecasts and to book five working days prior to the goods being ready for shipment enabling us to optimise use of the available capacity and provide the best possible solutions. 

Oriental Dixie | Charter Service from Shanghai to the US

To support the need for capacity in and out of China and Hong Kong, DSV is positioning its Intra-Asia trucking network and Sea-Air service via Dubai and Singapore to offer customers alternatives to keep their cargo moving at a comparatively lower rate than air transport and at controllable transit times. Contact your local sales representative at DSV for a quote. Space is limited.

The Merlion | Sea-Air via Singapore

The Gulf Tiger | Sea-Air via Dubai

Sea freight

In recent weeks, shipowners have cancelled a large number of departures from Chinese ports. Production in China are gradually ramping up and terminal and pick-up/delivery services are improving with most drivers returning from quarantine. We are still facing road limitations in certain districts as part of local government efforts to contain the Coronavirus situation.

In South China, the factories are back to full production. Demand for export via sea is high, as shippers are shifting from air freight to sea freight to meet their adjusted delivery schedules at destinations. With blank sailings announced for various trade lanes, the overall capacity ex South China is tight, in particular to Vietnam, Thailand, Oceania, India Subcontinent, Middle East / Red Sea, Europe / Mediterranean, and US West Coast. DSV is working closely with our core carriers to secure space for our customers, however, given the highly volatile market, we encourage our customers to place bookings at least 14 days in advance, and, if possible, up to 4 weeks in advance for the lanes mentioned above.

Given the situation, port authority or carriers may announce surcharges to adapt to the changes in the market. We’ll keep monitoring the situation, and keep you informed.. Meanwhile, to avoid the capacity shortage and high rates during peak time, we encourage customers to provide demand forecasts with us so our representatives can work on a solution to ensure minimum disruptions to your supply chain.

Road transport

Currently, strict regulations complicate both road freight and passenger traveling in China. Combined with the enhanced measures for COVID-19 such as temperature checks, health declarations and COVID-19 tests, backlogs and delays are expected from a few hours to a few days, subject to the various requirements by local authorities in different provinces.

We see improvements in the overall situation concerning road transportation over the last week, and trucker availability is almost back to normal. To help resolve the capacity shortage and the high rates via air transport, DSV is offering our clients alternatives such as trucking service from South China to North and Central China, as well as to a number of neighbouring Asian countries such as Vietnam and Thailand. Due to the Movement Control Order by Malaysian government, shippers can only move goods with the approval of the Malaysian authority. Contact us to get more information at sales@hk.dsv.com.

Asian Link | Intra-Asia Trucking

Rail Service Connecting China and Europe

We have summarized the key trucking aspects in the below table, which are updated frequently by DSV China.

For urgent enquiries, please reach out to your account manager. Thank you.