Lidl, one of the largest supermarket retailers in Europe, is planning to increase imports from Vietnam and Malaysia to diversify and protect its supply chain amidst growing global uncertainties.
Schwarz Group, parent company of Lidl, established its own container shipping company, Tailwind Shipping Lines, in 2022 to strengthen control over its supply chain and ensure reliable delivery of goods from China, Bangladesh, and Sri Lanka to stores across Europe. Currently, Tailwind is the second-largest shipping company in Germany, with a fleet of 9 container ships.
Tailwind has recently added HCMC in Vietnam and Port Klang in Malaysia to its shipping route in June, which previously only connected Chattogram in Bangladesh and Colombo in Sri Lanka. Port Klang has replaced Colombo as Tailwind’s main transshipment hub in Asia, connecting to the main shipping route between China and Europe. Nico Peters, Vice President for commercial management at Tailwind said, “This will further enhance the international supply chain.”
Lidl currently owns 12,350 stores, mostly located in Europe, accounting for about 8% of the total market share in Germany, the UK, France, Italy, and the Central and Eastern European region.
Despite primarily focusing on food products, Lidl still imports a large portion of non-food products from China. Malaysia and Vietnam faced tariffs of 25% and 20% respectively from the US, but tariffs on China are expected to be higher, although they are temporarily suspended until mid-August.
