April 02, 2010 — To keep up with the increase in logistics demand now that the ASEAN-India Free Trade Agreement (AIFTA) is in effect (as of January 1, 2010), Nippon Express Co., Ltd., will launch a "Mekong-India Express" intermodal transport service between Thailand and India.

Under this free trade agreement (FTA), the tariffs on 80% of commodities subject to tariffs (accounting for 75% of trade in terms of value) are to be phased out by both Thailand and India.

Trade in those automotive-related parts, household appliances and other goods for which tariffs are to be lifted is expected to increase between Thailand, home to the production plants for these products, and India, the production location for the automobiles themselves as well as a market for household appliances, as a consequence of this agreement.

In particular, Chennai (in the eastern Indian state of Tamil Nadu) is host to a great number of automobile manufacturers and related parts manufacturers from Japan and elsewhere around the world who have already set up operations locally or are currently constructing plants there, and an expansion in import volume centered on automotive-related parts is anticipated.

Transport from Thailand to Chennai has conventionally followed maritime routes passing south of the Malay Peninsula, commonly requiring transshipment at Singapore. Customers are increasingly demanding shorter lead times and more regularly scheduled transport.

The new service product being offered by Nippon Express utilizes multimodal transport to transport goods via the Company's SS7000 Asian truck transport service between Bangkok, Thailand and Port Kelang, Malaysia and by its NVO service between Port Kelang, Malaysia and Chennai, India.

This approach offers lead times of approximately one week less than conventional "all-water" maritime transport, and transport quality and traceability can be substantially improved by utilizing the Nippon Express network from start to finish.

Nippon Express (India) Pte. Ltd., is now putting into place a just-in-time (JIT) distribution network for automobile production parts in India; linking this to the Mekong-India Express service will enable the Company to provide automotive-related logistics across a broader area.

By continuing to offer new services connecting manufacturing and sales locations through the economic pipeline known as the Mekong-India Industrial Corridor, Nippon Express will ensure even greater support for its customers' procurement, manufacturing and sales efforts.