China is the world’s largest logistics market, estimated at $1.76 trillion in 2018.1 For an economy based on supplying low-priced commodities for export, logistics in China is surprisingly expensive. For example, of the total amount spent on Chinese goods, approximately 20 percent goes into logistics. That’s over twice as much as what U.S. companies spend on logistics. Half of China’s logistics spend goes into transportation.
China has over 2.5 million miles of roads.2 Village roads (as shown in Figure 7.1) account for roughly half of all Chinese roads. However, when it comes to moving freight, village roads aren’t of much use. By weight, 80 percent of Chinese cargo is transported on highways.3 Reliance on highway transport ...
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