Author: Archive

UAE, China look at postal tie-up

Posted by | Feb 25, 2008 | |

A high-level delegation from China Post Group, led by Zhang Yafei, President of the Group, explored the potential for stronger business ties with Emirates Post, at the end of an official visit.

The Chinese officials held talks with Ebrahim Karam, CEO of Emirates Post, Salem Al Shaye’e, Assistant Director General, Operations, Emirates Post and Saif Ali Al Shehhi, Director of Operations, Emirates Post.

The two sides agreed to pursue new business partnerships and agreed there was potential for stronger cooperation.

Karam briefed the visitors on the establishment of the Emirates Holding Group and outlined the responsibilities of subsidiaries.

Al Shehhi referred to the existing cordial relations between China and the UAE.

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U.S. Postal Service undercharged countries for mail

Posted by | Feb 25, 2008 | |

The U.S. Postal Service undercharged countries including China, India and Canada by millions of dollars because of errors in processing mail at John F. Kennedy International Airport in New York, auditors said.

The Postal Service may recover USD 2.2 million of the USD 3.4 million that it said it is owed by the postal agencies of the other countries, a report by the service’s inspector general said. The remainder stemmed from computer, billing and employee errors made in 2006, too long ago to be recovered under law.

The Postal Service’s JFK Airport facility made billing errors on 78 percent of the overseas mail received from Oct. 1, 2006, to May 31, 2007, according to a Jan. 24 report displayed on the agency’s Web site last week.

About 39 percent of the mail was from China. The JFK Airport facility processes international mail from more than 190 countries, Yoerger said.

The Postal Service is a government agency required by law to set its rates to cover costs. It had USD 75 billion in revenue last year, and ran a deficit of about USD 5 billion, Yoerger said.

The JFK Airport location, the largest of five Postal Service facilities in the U.S. that process international mail, handles 60 percent of all overseas express mail entering the U.S. If auditors hadn’t caught the errors, the facility would have undercharged foreign agencies USD 12.5 million over two years, the report said.

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DX call for rebalancing of mail market in UK

Posted by | Feb 25, 2008 | |

DX Mail services has reminded Postcomm that the present VAT exemption enjoyed by Royal Mail makes the mail market in the UK somewhat unbalanced and since Postcomm has no powers to change this directly, it should consider ‘levelling the playing field upwards through the adoption of measures that positively discriminate in favour of new entrants’

DX argue that the VAT exemption status of Royal Mail means that rivals are at a disadvantage in comparison with RoyalMail, and TNT and UK Mail (who use Royal Mail for the final mile delivery) are able to take advantage of the recently introduced agency agreements to minimise VAT liability for their customers whereas DX has to apply VAT.

The European Commission sent formal requests to the UK, Germany and Sweden in 2006 with regard to VAT application on postal services and more recently TNT, the Dutch postal operator has raised concerns over VAT in Germany where Deutsche Poste AG also enjoys VAT exemption for 40 pct of its operations.

However, the German Economy Minister, Michael Glos, recently announced plans to restrict the VAT privalege, and the USO in Germany will in future by VAT free for competitors as well as Deutsche Poste.

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UK Post Office cuts mortgage rate – again!

Posted by | Feb 25, 2008 | |

The Post Office has made a further rate cut to its three year fixed rate mortgage taking it to 5.34 per cent, creating the best deal of its kind on the high street.

The mortgage combines not only a leading rate, but also one of the lowest arrangement fees currently available at just GBP 399, and can be taken on up to 95 per cent of a home’s value, giving Post Office customers a market leading deal. A lending fee of GBP 195 is payable at either the beginning or the end of the mortgage term.

Bucking the trend of the current market, this is the third cut to the Post Office’s fixed rate mortgage since its launch at the end of 2007:

• September 2007 launched with rate of 6.09 per cent
• November 2007 – 5.64 per cent
• January 2008 – 5.48 per cent
• February 2008 – 5.34 per cent

The three year fixed rate deal is part of a range of mortgages being trialled by the Post Office in selected branches in the North. Its early success has now led the Post Office to extend the trial to other branches across the UK.

Post Office has also cut rates on its three year fixed buy-to-let and self-certification mortgages from 5.99 to 5.79 per cent, also making its self-certification product the best deal of its kind available.

The mortgage trial, launched in September 2007, follows a succession of well-received financial product launches by the Post Office which is now the fastest growing financial services provider in the UK.

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time:matters extends its rail transport network

Posted by | Feb 25, 2008 | |

time:matters, the same-day express and emergency logistics company, is extending its rail network service “ic:kurier” within Germany and considering introducing it into European markets.

In cooperation with Deutsche Bahn, time:matters already uses high-speed ICE and Inter-City trains to offer the ic:kurier same-day delivery service through 140 railway stations across Germany. Since January, the company has added nine more medium-sized towns to the network, and plans to add 20 further railway stations by the end of the year.

“Our ‘Special Speed Services’ are characterised by their multi-modality – meaning that we can offer express deliveries according to the individual customer needs by air, road or even rail,” said Joerg Asbrand, Director Operations and Customer Service. “Against this background, we are continuing the expansion of our rail service “ic:kurier” to offer the best possible services to our existing and potential customers.”

Moreover, time:matters is currently examining the option of extending its rail-based courier service to European destinations, Asbrand added.

In addition to the rail-based network, time:matters, with offices in Germany, Switzerland, Austria and China, uses the network of Lufthansa and various partner airlines such as Swiss to serve over 400 destinations in 90 countries.

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Overnite Express takes the bus to southern India

Posted by | Feb 25, 2008 | |

Indian courier company Overnite Express has linked up with a large bus company, the Andhra Pradesh State Road Transport Corporation (APSRTC), to extend its reach in the fast-growing southern Indian market.

Under the strategic agreement, Delhi-based Overnite Express will be utilizing dedicated space in long-distance Garuda Buses operated by APSRTC to transport goods, parcels and couriers. The new service covers the four states of Andhra Pradesh, Maharashtra, Tamil Nadu and Karnataka.

This service will benefit a diverse range of industries and enable them to move their products between destinations in a faster time, said O. P. Rajgarhia, Chairman and Managing Director, Overnite Express.

The launch of this new service will help Overnite reach most of the prominent destinations in the state of Andhra Pradesh, he added. Already a strong player in the north and eastern regions of the country, the company is now concentrating on South India, and is in the process of opening over 100 branches and express collection centers all over the state.

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DHL-Lufthansa freighter debut in 2009

Posted by | Feb 25, 2008 | |

DHL Express and Lufthansa Cargo’s new joint venture cargo airline AeroLogic will take off in the first half of next year with the 103-tonne B777-200 freighters. AeroLogic initially plans to operate a leased fleet of 11 B777-200s, mainly from its home hub in Leipzig, Germany, to/from major Asian markets, subject to obtaining traffic rights.

The first four aircraft are scheduled for delivery in 2009, starting in February, with four more to follow in 2010, two in 2011 and the final one in 2012.

DHL Express, part of German logistics group Deutsche Post World Net, will take the major share of the new B777F fleet capacity on weekdays to boost its Asia-Europe air express network. At weekends, Lufthansa Cargo will take over the main responsibility for filling the aircraft, this time with freight, on both scheduled and charter services, mainly on European routes to/from Asia and also North America (New York and Chicago).

In terms of aircraft block hours, the anticipated split will be 74 percent express network operations and 26 percent general cargo services. Capacity-wise, the weekly split will be DHL 61 percent, Lufthansa Cargo 39 percent.

DHL Express chief executive officer of global aviation, Charles Graham, claimed the advent of the B777F operations would speed up overall transit times for the Europe-Asia express traffic. “The percentage of traffic in both directions between Europe and Asia that we are able to pick up and deliver on the other continent before noon on the second day will increase to something like 80 percent,” he said.

AeroLogic, which is capitalised at USD74 million, is targeted to generate revenue of USD148 million in its start-up year of 2009, rising to USD 444 million in 2010 and USD 814 million once fully operational in 2011. The new airline will lease its first eight B777Fs from a company called Deucalion Capital VII, which is managed by German financial institution DVB Bank.

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Exit of Zumwinkel may end DHL push into US

Posted by | Feb 25, 2008 | |

The abrupt exit of Klaus Zumwinkel, chairman of DHL parent Deutsche Post, has heightened speculation that DHL may sell its struggling US business.

Zumwinkel tendered his resignation on February 15, following raids of his office and residence by German tax authorities the day before. He is being investigated for alleged tax evasion of around USD 1.4 million.

With his November retirement day in sight, Zumwinkel left under a cloud after leading the company for 18 years. He turned a postal outfit into an USD 88 billion logistics giant.
Throughout his tenure Zumwinkel was seemingly untouchable, lording it over Deutsche Post. But in recent months he came under mounting criticism, most of it directed at DHL’s struggling US expansion. Having acquired Airborne Express for about USD 1 billion in 2003, the company was trying to establish itself as a third force in the US market behind UPS and FedEx, but the operation has produced a flood of red ink, despite several efforts and heavy investment to stem the flow. According to some estimates, DHL could lose D 900 million in the US this year alone.

The first salvo against the US strategy came last November, when investment firm Bear Stearns concluded that DHL stood no chance of producing profits in the US in the foreseeable future and advocated a retreat from the US market. Subsequently a second Wall Street firm argued that DHL should abandon the intra-US business.

Since then, speculation has been swirling around DHL that it might sell its US business.
Although the new Deutsche Post chief Frank Appel has pledged to focus on the loss-making US unit and chief financial officer John Allan, whose contract has been extended by two years until the end of 2010, pledged to improve performance of DHL in the US, rumours have been leaking out of Deutsche Post’s headquarters that a number of options were under consideration to end the losses in North America.

One scenario that has been bandied about sees DHL handing over the intra-US business to FedEx, which could in turn have DHL handle its intra-European traffic. FedEx and Deutsche Post have declined to comment on these speculations, but sources close to DHL place the origin of this rumour in the Deutsche Post management.

Selling the US arm of DHL Express to FedEx seems unlikely, though, as FedEx has no need for the infrastructure that its smaller rival has built up in that market. Moreover, an outright sale might face legal obstacles. A report by Bear Stearns argues that anti-trust reasons would prevent FedEx from buying what amounts to 11-12 percent of the US air express market.
“However, we suppose FedEx could purchase DHL’s smaller ground business and form some form of partnership with DHL to deliver some portion of their air express packages,” the report concluded.

While not commenting directly on rumours of a FedEx deal, Allan declared that “there can be no question of exiting the US business. Any options which include a withdrawal can be completely ruled out”.

Deutsche Post has repeatedly stressed that its presence in the US market generates a host of international traffic, such as flows from Asian customers to North America. Allan declared that the US express business is a key management priority for Deutsche Post.
“We are looking at a variety of options to improve performance. In doing so, we are committed to maintaining a significant presence in the US market, which remains of strategic importance to the group,” he said.

The first salvo since these comments came on February 12, when DHL Express USA announced a plan to eliminate some 600 jobs. “This action is one of several measures we are taking to improve our competitive position in the US market, which is strategic to our global growth plan,” said Hans Hickler, CEO of DHL Express USA.

But profitability is in short supply. On January 24, Deutsche Post announced it would take an USD 874 million write-down of the value of its express business in the Americ

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