China's largest logistics group has emerged! On December 3, 2021, China Railway Materials Co., Ltd. issued an announcement on the progress of the professional integration of the logistics sectors of China Railway Materials Group and China Chengtong Group. The controlling shareholder China Railway Materials Group has completed the change of industrial and commercial registration information and the company name has been changed to "China Logistics Group Co., Ltd.".

The emergence of this super combination may bring some changes to the Chinese logistics market and even the international logistics market. Prior to this, among the five major logistics group companies of the State-owned Assets Supervision and Administration Commission of the State Council, China Merchants Group and Sinotrans & CSC were integrated to become China's largest integrated logistics company.

China Logistics Group was born

The newly reorganized China Logistics Group will be performed by the State-owned Assets Supervision and Administration Commission of the State Council on behalf of the State Council. The shares of the company and China Packaging Co., Ltd. were transferred to the integrated new group free of charge. After this integration, the company's controlling shareholder and actual controller have not changed.

China Railway Materials Group Co., Ltd. (abbreviated as China Railway Materials) is a large-scale central enterprise directly supervised by the State-owned Assets Supervision and Administration Commission of the State Council. It is called the "General Logistics Department" of China Railways in the industry. The group company is headquartered in Beijing, and has more than 100 branches in the country and the United States, Australia, Hong Kong, Laos and other countries and regions. In September 2010, China Railway Materials Corporation was reorganized and restructured to establish China Railway Materials Co., Ltd. In December 2017, with the approval of the State-owned Assets Supervision and Administration Commission of the State Council, the company implemented the restructuring of the company and was officially renamed China Railway Materials Group Co., Ltd.

According to the official website of China Chengtong Holding Group Co., Ltd., the State-owned Assets Supervision and Administration Commission of the State Council of China Chengtong Group is the first batch of pilot enterprises to build a standardized board of directors and the first pilot enterprise of state-owned asset management company. China Chengtong was established in 1992 by the merger of materials circulation enterprises directly under the former Ministry of Materials. In February 2016, China Chengtong was identified as a pilot state-owned capital operating company for state-owned enterprises.

Previously, China Railway Materials Co., Ltd. issued the "Announcement of China Railway Materials Co., Ltd. Regarding the Approval of the Professional Integration of Logistics Sectors of China Railway Materials Group Co., Ltd. and China Chengtong Holding Group Co., Ltd." on November 30, 2021 ( 2021-P051), announced that China Railway Materials Group Co., Ltd. (hereinafter referred to as "China Railway Materials Group") and China Chengtong Holding Group Co., Ltd. (hereinafter referred to as "China Chengtong Group") will implement professional integration of the logistics sectors. China Railway Group changed its name to the integrated new group, and transferred the relevant corporate equity held by China Chengtong Group and its affiliated companies to the integrated new group free of charge. The integrated new group will focus on building a modern logistics enterprise with a complete industrial chain and strong comprehensive strength around the needs of the construction of a modern circulation system.

No. 1 in the world made in China, but logistics is not

Regarding the reasons for the merger, Tsinghua University Industrial Engineering professor and PhD supervisor Liu Dacheng said that from the perspective of historical development, we used a piecemeal management method to artificially divide the logistics support system, resulting in insufficient integration between enterprises. After the reform and opening up, the logistics industry has been greatly developed, but because of the inertia of management and power, there are still problems such as information interoperability, overlapping or lack of resources.

With the rapid development of Made in China and the Chinese economy, our position in the global value chain has been rising, but our guarantee system has not yet been able to match it. Especially this time, due to the changes in the future global logistics guarantee system caused by the epidemic, the status of China's logistics industry is seriously mismatched with the status of Made in China.

With the US's large-scale investment in infrastructure construction, the global logistics supply chain in the future will begin to change towards flexibility and safety and shorten the supply chain, which poses a very big challenge to China's future logistics system. Therefore, in order to maintain the global market made in China, China needs an effective guarantee to ensure that companies can go out of China and into the world.

China Logistics Group will integrate resources and form a new logistics system through effective integration in procurement, transportation, warehousing, packaging, etc., effectively utilize resources, and go global through scale and complete systems to ensure manufacturing in China Globalization will play its due safeguard role. The establishment of China Logistics Group will lead to some monopolies, but it will also improve its own cost control and market profitability. It will play a leading role in China's logistics industry "out of China and into the global market". Keywords: reorganization of central enterprises, central enterprises, engineering construction

Realizing the improvement of overall service quality through scale is a guide for China's logistics industry. If the effect is good, it is also an opportunity for us to break through the international logistics service market. By ensuring the global layout of Made in China and the status of the Chinese economy and Made in China in the global value chain, the logistics industry, a guarantee system, can also grow. Editor/Sang Xiaomei