ITL enhances Vietnam’s logistics capabilities through a sharing ecosystem

Currently, Vietnam ranks in the top 10 emerging logistics markets globally (Emerging Markets Index 2023), according to Agility, a transportation and logistics services provider. The forecasted compound annual growth rate for the industry from 2022 to 2027 is 5.5%.

Tran Tuan Anh, Head of the Central Economic Committee, also recognizes logistics as an essential service that has made significant strides, contributing significantly to economic growth and employment. However, the industry still has limitations and has not fully developed in line with its potential.

For instance, according to the Vietnam Logistics Service Business Association, the average logistics cost in Vietnam is around 16.8 - 17%, still higher than the global average (approximately 10%). Reasons include limited logistics capacity, poor infrastructure and lack of connectivity between modes of transportation.

At the forum, Pham Hai Anh, Deputy General Director of Sowatco, a member of Sotrans Group (a subsidiary of ITL), proposed utilizing the existing river system in the deltas through combining barges and dry ports, ICDs. 

For instance, in the Mekong Delta, the average freight rate per container from Can Tho to Cai Mep is around VND 8.5 – 9 million. Hai Anh suggested that developing waterway transportation using barges, combined with ICDs to connect to roads, could reduce costs by up to 50%. “Using barges is a reasonable solution in near future. In the long term, building more sea ports and large scale logistics hubs using barges is also the best way”, he said.

This proposal stems from his practical experience in Sotrans Group in particular and ITL in general. As a leading integrated logistics service provider in Vietnam and the region, ITL has a sharing logistics ecosystem, offering flexible transportation solutions to meet customer needs.

This sharing ecosystem has been built on three factors for a long time: system connectivity, operational processes, and infrastructure. To effectively expand its ecosystem, ITL has expanded resources by synergizing with major enterprises in the industry. Its acquisition of Sotrans Group in 2020, a leading provider in international and domestic transportation, multifunctional warehouses, seaports, and port logistics, is a notable example.

Currently, ITL operates 30 barges, more than 5 ports and ICDs all over the country, with a total warehouse area of up to 500,000 square meters. Along with a modern fleet of 500 trucks and prime movers, ITL ensures the organized and cost-effective transportation of goods.

ITL has a sharing ecosystem to provide customers various transportation solutions.

Alexander Olsen, Vice President of Freight Management and Commercial of ITL, stated that the group continuously enhances the capacity of its vehicle fleet and infrastructure to serve the multi-modal transportation needs of customers.

"Within our ecosystem, we are continuing to develop barge transportation capabilities and the infrastructure system (dry ports, ICDs) around rivers. This approach creates flexibility in combining multi-modal transport and enhances fleet efficiency, which significantly reduce costs," he shared.

ITL is also the GSA of 23 airlines, operating cargo transportation in more than 200 flights per week, with a capacity of up to 150,000 tons of cargo per year. This advantage allows ITL to expand internationally, reaching wherever customers need.

With the ability to provide various logistics solutions - from international End2End cargo transportation to Cold Chain, ITL is the pioneer in supporting customers to optimize costs and transportation methods. Recently, ITL has continuously invested in its ecosystem.