UPS Deutschland Sticks to Its Strengths

UPS Deutschland Sticks to Its Strengths

HB/sms DÜSSELDORF. UPS Deutschland Inc. & Co. OHG plans to focus on its core business of parcel delivery, chief executive Wolfgang Flick told Handelsblatt.

He said his company, the German arm of the U.S. logistics giant UPS, sees itself as a specialist in parcel delivery and express services. Letter delivery is not one of the company’s areas of competence, so it has no plans to enter this market even after the expiry of Deutsche Post’s monopoly over the delivery of letters weighing up to 200 grams.

But UPS Deutschland remains one of Deutsche Post’s loudest critics. It argues that Deutsche Post uses its highly profitable, monopoly-protected letter-delivery business to cross-subsidize its parcel-delivery business. And complaints it has brought before the EU Commission have already caused Deutsche Post to be fined 24 million euros for offering special discounts in its parcels business. Deutsche Post has also been ordered by the EU Commission Commission to make the financing of its businesses more transparent and to spin off individual business areas.

But the fines were levied in respect of past infringements of EU antitrust law. The Commission also conceded that Deutsche Post’s business in parcel deliveries has paid its own way since 1996.

Flick believes that his own company is farther down the road of becoming a high-tech logistics company than Deutsche Post. With the help of the Internet, UPS Deutschland offers its clients global logistics services along the entire value-creation chain.

One area where Deutsche Post has a head start on its rival is in financial services. It’s already active on this market with Postbank. But UPS Deutschland plans to start offering financial services in the near future, said Flick. It also plans to develop its business with private clients, which accounts for just 20% of total sales revenue right now.

Flick was unwilling to provide figures to back up his description of UPS Deutschland’s business development as “successful”. Marketing director Gunnar Adalberth would merely say that the company is growing faster than the market. UPS has been active in Germany since 1976. Its German operations now employ a total of 14,700 people.

HANDELSBLATT, Montag, 17. September 2001