Feb 11 • 13:30 UTC 🇨🇳 China South China Morning Post

How AI, delivery drones helped China cut logistics costs to a new low

China has achieved a record low in logistics costs through the use of AI and delivery drones, although expenses remain higher than in developed economies.

China has successfully reduced its logistics costs to a record low, with expenses now making up only 13.9% of its GDP as of 2025, according to the National Development and Reform Commission. This translates to 13.9 yuan spent on logistics for every 100 yuan of economic output, indicating significant improvements in supply-chain efficiency. However, even with this achievement, logistics costs in China still surpass those of most developed countries, highlighting ongoing challenges in cost management.

The integration of artificial intelligence and delivery drones has been instrumental in achieving these results. However, many of the technologies utilized in the logistics sector are still in trial phases or early stages of adoption. This slower penetration suggests that there remains substantial opportunity for further advancements in the industry. Additionally, while China shows promise in the development of intelligent logistics operations, its technology still relies heavily on imported components, indicating potential vulnerabilities in self-sufficiency.

Furthermore, China's infrastructure is a significant factor in its logistics efficiency. The country boasts the world's largest logistics infrastructure, which supports its capacity to handle large-scale logistics operations effectively. As China continues to innovate in logistics technology and further invests in its infrastructure, it may close the gap in logistics costs with more developed economies, but persistent challenges remain in the form of high costs and dependence on foreign technology.

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