Chinese-backed parcel carriers are rapidly gaining market share in the US logistics industry, putting pressure on established players like FedEx and UPS.
The ultra-low cost business model offered by these carriers is making it difficult for American companies to compete, with some saying they are taking away jobs by offering below-cost pricing.
Some analysts argue that characterizing Chinese-influenced couriers as a security threat overstates the problem and is a way to appeal to America-first tendencies.
However, others contend that these alternative carriers are indeed posing a national security risk due to their use of unfair foreign subsidies, vast amounts of granular data, and shady import practices.
The Arkansas senator has complained that US-incorporated companies have 'infiltrated' the US to provide cross-border logistics services for e-commerce platforms like Shein and TikTok Shop.
Other carriers of concern include Canada-based UniUni, Indonesia's J&T Express, which counts Chinese multinational technology conglomerate Tencent as an investor, and Zongteng subsidiaries YunExpress and Cirro Logistics.
The use of independent master contractors and app-based gig drivers by these carriers is also a point of contention, with some arguing it undermines the traditional delivery business model.
Startup parcel carriers began proliferating five years ago on the back of the pandemic-fueled e-commerce boom as Chinese marketplaces took advantage of an overlooked import loophole to rapidly ramp up B2C sales in the US.
The issue has been brought to light by a coalition of regional US parcel carriers, including Hovership, which is working behind the scenes to bring attention to the problem on Capitol Hill.
The use of unfair foreign subsidies, vast amounts of granular data, and shady import practices by Chinese-backed parcel carriers poses a significant threat to the US supply chain.
