The COVID-19 pandemic has swept the globe and the world of logistics has been turned upside down. Countries that are known for being exporters have had their factories shut down; countries known for consumption have closed their shop doors.
With the sudden lack of both supply and demand, as well as the disruption to air and sea freight, global logistics firms have been scrambling to pick up the pieces and re-establish the vital connections that hold the world of trade and commerce together. Out of this melee, some logistics firms have capitalized on the moment, finding new sources of demand and new roles to fill in a crisis that’s unlike anything we’ve seen before.
When we hear presidents and prime ministers talking about getting safety equipment and test kits out to the COVID-19 hotspots that need them, the task actually falls on the shoulders of logistics firms, who are often called on in times of crises to move things fast. In the coronavirus pandemic, some logistics firms have pivoted from solely operating as vectors for the transfer of goods to becoming the carriers of life-saving medical equipment.
In early February, as Wuhan was in the thick of its fight with COVID-19, UPS provided free air transport for two million masks, 11,000 protective suits and 280,000 pairs of medical gloves to China.
When the pandemic spread to the U.S., UPS’s healthcare division found itself in a unique position to provide support for initiatives aimed to curb the spread. Partnering with the Federal Emergency Management Agency and the Trump administration’s coronavirus task force, they became one of the key transporters of vital testing equipment.
“They are reaching out to us to receive products that they’re buying all over the world, including China, Guatemala, Thailand and Malaysia, to bring in face masks, kits, and different types of materials, protective gear,” says Wes Wheeler, the president of UPS’s global healthcare and life sciences unit. “They are procuring supplies from everywhere in the world to bring into a central location, and we’re setting up our site in Louisville to handle that for FEMA.”
From there, UPS is implementing end-to-end solutions to help states set up COVID-19 testing centers in the parking lots of schools and Walmarts. They ship in the equipment to build the tents, the testing kits, and the protective equipment and then they ship out the patient samples to be tested at relevant facilities. UPS Healthcare has also partnered with the VA hospital network to coordinate logistics for COVID-19 testing along with a few companies that are developing in-home testing kits, including LetsGetChecked.
In China, as Xi Jinping talks about the creation of a new “Health Silk Road,” it is the logistics companies on the ground that are doing the heavy lifting. Just as the China-Europe rail network was the vanguard for the Silk Road Economic Belt, it’s right at the forefront of China’s aid to European countries that are currently being walloped by the coronavirus.
Right now, a freight train that departed from Yiwu on March 21 is chugging across Russia. Within 10 days, it will be pulling into Madrid laden with 110,000 medical masks and 800 protective suites—sorely needed medical supplies for a country that has been ravaged by COVID-19.
“Since Spain has the problem and in China it seemed to be a little more under control, we felt like it was our obligation to help,” says Carlos Santana, the general manager of Timex Industrial Investment (YXE), the company that manages the rail route and paid for the donation.
This train from Yiwu to Madrid, which is the longest rail line in the world, has been regularly running since 2014. It usually carries electronics, automobile components, and other goods, but from now until the crisis ends the company has made space available to any individuals or companies looking to make a donation to the COVID-19 relief efforts in Europe.
“The economy is going to be disrupted and we are part of that economy. I can’t have the train operating and going empty,” Santana says.
Due to the closure of factories in China from the end of January until mid-March while the country was in quarantine along with the sudden drop in demand for Chinese goods in Europe, regular service on YXE’s trans-Eurasian trains was disrupted.
“So we have to offer these logistics alternatives,” Santana explains. “With the first service, we decided to send supplies to Spain—but it’s not like we’re now the Red Cross or something like that.”
YXE now operates a total of 10 connections between Yiwu and Europe and the Middle East, directly connecting the east of China with cities like Madrid, Duisburg, Riga, Prague, Małaszewicze and Moscow. Santana emphasized that even though they are carrying medical supplies for free, they are still functioning as a business and transporting their regular cargo load as well.
As more and more countries in the world go into lockdown to inhibit the spread of COVID-19, the companies that transport goods from point A to point B have become more of an essential business than ever.
“We are on the frontlines of this scourge,” Wheeler proclaims. “We’re a logistics company so we are used to being nimble—we respond to hurricanes and disasters everywhere. We’re always ready.”