Why the Chinese see Budapest as the ideal rail freight entry to Europe
In China, rail freight operators consider Budapest as one of the rail freight main hubs in Europe. Although traffic is now diverted via Malaszewicze due to the war in Ukraine, it is still consolidated in the Hungarian capital. At the RailFreight on Tour in Debrecen, Andy Luo from Dimerco shared the Chinese perspective on Hungary as a rail freight country in a video interview with our sister publication RailFreight.cn.
Luo described the advantages of Budapest as “the operating capacity of the terminals and the available routes leading to the city”. “Especially before the outbreak of the Russian-Ukrainian conflict, there was a direct line from China to Budapest. Starting from Xi’an, China, passing through Kazakhstan, Russia and Ukraine, cargo used to be reloaded to European gauge at the border port of Zahony in Hungary.
You can watch the video interview at the bottom of this article.
“The transit time of this route is about seven days faster than the traditional route via Malaszewicze; at fastest, Budapest can be reached within fourteen days.In addition, Budapest has a complete railway distribution network. After the goods arrive in Budapest, they can be delivered to Bucharest/Constanza, the port of Koper, Duisburg and Hamburg within 2-3 days.”
“In choosing railway routes, Chinese platform companies mainly choose Budapest as the first hub in Europe”, he continued. The distribution range is large. In contrast, Vienna or Bratislava have an incomplete industrial setup and higher transit costs. Because of this, only few customers choose to book directly to Vienna or Bratislava.”
Affected by the situation in Russia and Ukraine, the point of entry in Europe had to be adjusted, Luo explained. However, due to unavailability of the route through Ukraine, traffic had to be diverted via Malaszewice in Poland. This results in longer transit times.
According to him, Záhony as an entry point has many advantages. “Railways and highways intersect here, and the network extends in all directions. It is close to the European as well as CIS markets, and there are many cooperation projects between Hungary and Chinese companies. Moreover, there is a good Investment environment.”
New station, new opportunity
At the Rail Freight on Tour Summit, visitors were taken on a site tour to the East-West Gate’s new terminal in Fenyestlitke. Luo pointed out that “this is an ambitious plan, aiming to build the largest and most modern inland terminal and logistics center in Europe. If it is up and running, it can indeed form an important transshipment hub for Eurasian corridor. I believe it will further strengthen the positioning of Hungary in the operation of China-Europe freight trains.”
At the end of the interview, Luo was asked to explain the reasons behind Hungary’s good reputation in China’s logistics industry. Andy concluded: “Hungary is a member of the European Union and one of China’s largest investment partners in Central and Eastern Europe. In recent years, bilateral trade has continued to hit new highs and there are many investment projects with positive effects, all of which represent policy dividends and stability, and these are particularly important and valued by our logistics service practitioners, especially in the current situation of uncertainty.”