DHL plans sea and air freight coup

German-owned parcel and logistics giant DHL has underlined its ambition to become the global number one in sea and air freight forwarding, writes Katrin Berkenkopf.

‘Our impressive results show that we have successfully advanced our growth course and succeeded in convincing many new customers of our global capacity in a highly competitive market,’ said Dr Frank Appel, board member of the Deutsche Post subsidiary.

DHL Danzas Air ‘ Ocean already ranks itself as the number one air freight forwarder, and number two in ocean freight, second only to Kuehne + Nagel, which handled 1.6m teu worldwide last year.

However, the combined top five sea freight players have a market share of less than 25percent, with DHL itself accounting for about about 7.3percent.

‘Since its integration into Deutsche Post, the long-standing Danzas company has continued its success story and is now one of the clear leaders in global competition among air and ocean freight providers,’ said chief operating officer Renato Chiavi.

The group pointed out that it has more than doubled its sea freight volume since 1999, handling some 1.1m teu last year.

Between 2003 and 2004 alone, the growth rate in cargo volume was 19percent, which contrasts with an estimated market growth of 9percent to 12percent, DHL said.

In addition to strong growth on the trades from Asia Pacific to Europe, the group also reported a boost in volume out of Brazil.

DHL claims it is already the number one in less than container load, and number two in full container load. And said that they were seeking organic growth in order to secure and further expand this position.

In air freight, the group increased transport volumes more than four times between 1999 and 2004, to 2.2m tonnes. It set up a joint venture called LifeConEx with Lufthansa Cargo, effective April this year.

The new venture is based in Miami and targets the global life science industry. ‘It is the first company to virtually integrate the operating standards of the airline, ground handling and freight forwarding service providers to create more value for shippers,’ said Mr Chiavo.

DHL Danzas Air’Ocean, together with the contract logistics business of DHL Solutions, forms DHL Logistics. The latter last year recorded a turnover of EUR6.8bn (USD8.88bn), which was 15percent more than a year earlier. EUR500m of this stemmed from sea and air freight business, of which one third is sea freight.

Operating profits of DHL Logistics reached EUR281m, up from EUR206m a year earlier.

The group operates a warehouse capacity of 3m sq m and has 890 terminals, offices and distribution centres.