DHL looks to Chinese growth
DHL is to intensify its development and positioning in the Greater China area. As a part of the development, Ken Allen, global CEO of DHL Express is joining the Board of the DHL-Sinotrans Joint Venture in China.
“We are very pleased to have Ken Allen join the Board of DHL-Sinotrans, the joint-venture between DHL and Sinotrans with focus on operating and developing the express business in China,” said Zhao Huxiang, president of Sinotrans Group and chairman of the DHL-Sinotrans Joint Venture Board. “With the wealth of experience and leadership Ken has in managing a significant, successful and complex global business, he will bring new perspectives and international best practices that will not only further strengthen our 24 years’ of rewarding partnership and cooperation but also bring our business to new heights.”
Frank Appel, the Group CEO of Deutsche Post DHL said, “Over the last 24 years, DHL-Sinotrans has been recognised as the market leader and a pioneer in the Express and Logistics industry in China. Today, China is one of the most important markets for Deutsche Post DHL. Ken Allen will be working closely with Jerry Hsu, President of DHL Express Greater China to develop our positioning in the Greater China market and look for additional growth opportunities to leverage our pioneering position.”
“Greater China is one of the fastest developing markets within DHL’s global network and plays a vital role in DHL’s Asia Pacific and global operations,” said Allen. “This is an important step to enable Deutsche Post DHL to further advance our footprint and presence, strengthen our market-leading position in Greater China and expand our capabilities to meet the growing demands of the market.”
Today, China is the world’s fastest growing express delivery market. According to the China Transportation and Logistics Industry Outlook (2010 – 2015), published by US consulting firm, AT Kearney and China’s Tongji University, China’s international express market reached RMB 15.5bn in revenue in 2009. As China’s economy continues to grow, the express delivery market is expected to maintain a high double-digit growth rate – two to three times the country’s GDP growth.
Being the first international express company to enter Greater China, DHL has extensive experience and deep knowledge of this market. The company has close to 9,000 employees in China and its services extend to more than 400 Chinese cities. In the international express market of Greater China, which is estimated to be worth US$ 3.4bn, DHL commands a significant market share.
Jerry Hsu, president, DHL Express Greater China Area and executive vice president, Deutsche Post DHL said, “The rapid growth of China’s economy and remarkable potential in the express and logistics industry provide DHL with exciting opportunities. DHL will continue to invest in Greater China and the close involvement of Ken Allen, our global CEO, signifies and strengthens our commitment to substantially progress our positioning in this market.”
From 2000 to 2009, DHL’s total investment in Greater China reached a phenomenal US$ 1.56bn. Some of the key investment projects included:
- US$ 210m to build and expand the Central Asia Hub (CAH) in Hong Kong, the first large-scale automated Express hub in Asia Pacific
- US$ 175m to establish the North Asia Hub in Shanghai, to be completed in the first half of 2012
- US$ 24m has been invested to build the new state-of-the-art DHL-Sinotrans Headquarters in Beijing, the flagship head office for its Express operations
- US$ 4.2m has been invested to set up DHL Shared Service Center in Chengdu to provide DHL-Sinotrans with financial shared services
- US$ 316m investment program for Express and Logistics infrastructure in China, including the launch of DHL’s Domestic Airfreight service in China in early 2007
- US$ 400m has been invested into DHL’s joint venture with Cathay Pacific and Air Hong Kong under the joint venture agreement (DHL owns a 40% stake)
