Tag: Courier/Express/Parcels

Analysts hand DHL bad new year's forecast (U.S.)

Posted by | Jan 17, 2008 | |

Worldwide shipper DHL is doomed to fail in the United States unless it radically shifts its business model, two well-regarded investment firms say.

Now, Morgan Stanley and Bear Stearns separately contend that DHL could eventually contract out operations to competitors, abandon its domestic delivery routes or sell off its U.S. operations entirely.

Facing U.S. operations that lost USD 900 million last year, the company’s new chief financial officer has “indicated the group needs to have a structural solution to U.S. losses” by March 6, according to the Morgan Stanley report.

“While we can’t respond to speculative reports, we have made a commitment to the U.S. market because of its importance to our overall global (DHL) Express strategy,” spokesman Richard Gibbs said in an e-mailed statement.

DHL, owned by German-based Deutsche Post, has spent billions of dollars to build up its domestic presence.

Nonetheless, U.S. operations lost USD 900 million last year and analysts don’t foresee a profit this year.

Morgan Stanley foresees three possible solutions:

Deutsche Post should try to sell all of DHL Express or at least the U.S. operations to UPS, FedEx or the U.S. Postal Service

DHL could fly parcels in but contract delivery to FedEx, UPS or the U.S. Postal Service

It could reduce its footprint to metropolitan areas and either contract pickup and delivery in the rest of the U.S. to the three carriers or offer only international delivery.

The first two options are less likely, according to Morgan Stanley.

In a November Goldman Sachs report, the firm said it was unlikely that DHL’s U.S. operation was on track to perform well.

Beh of Bear Sterns said any DHL decision to quit domestic operations would be difficult.

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Competition heats up in the Asian small-parcel market

Posted by | Jan 17, 2008 | |

Supply chain professionals being tasked with establishing or managing small parcel networks in Asia report being pleasantly surprised by the coverage and competition from the major parcel carriers. That said, there are some major differences between managing a small parcel logistics networks in Seattle and Shanghai.

Tom Stanton, international supply chain analyst at consulting group AFMS in Portland, Ore. says the three major parcel carriers—UPS, FedEx and DHL—are all investing heavily in the Asian markets, particularly China. He says the three are competing for reputation and market share in Asia just as fiercely as they do in the U.S., but from perhaps different positions.

Stanton says DHL has been in Asia the longest and the company claims to have as much as 38 pct of the market and combined the big three hold about two-thirds of the market. All are investing and growing dramatically in Asia. UPS is building a new hub at Shanghai’s international airport. UPS reported more than 20 pct overall business growth in China in the third quarter of 2007, with intra-Asia trade representing the fastest growth.

FedEx aims to begin operations at a USD 150 million hub in the southern city of Guangzhou in December 2008.

Most recently, DHL announced in November it was spending USD 175 million to build its North Asia Hub in Shanghai at the Shanghai Pudong International Airport, due to open in the second half of 2010. The hub will be DHL’s sixth in Asia, and will be able to handle as many as 20,000 parcels and 20,000 documents an hour, the company said.

In a Bloomberg interview, Jerry Hsu, DHL’s president of Greater China, said DHL may form a domestic air-cargo venture with a local carrier. The company has held talks with a number of airlines and drawn up a shortlist based on their hubs and gateways, he added.

Beyond the three major small package players, TNT Logistics and APL Logistics may be the only other names recognizable to U.S.-based supply chain managers. The rest of the market is filled in by local and regional Asian firms covering short shipments between factories or businesses.

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TNT has Triodos-led consortium build 'Green Offices' (NED)

Posted by | Jan 17, 2008 | |

TNT NV said it has chosen Triodos Group and OVG Projectontwikkeling to work together on the development of new sustainable office real estate, as part of TNT’s Planet Me programme.

TNT said 70,000 square meters will be developed into sustainable offices, with TNT’s headquarters in Hoofdorp to be the first of many ‘Green Offices’ to be built in The Netherlands. The Hoofdorp office is expected to be operational in 2010.

The sustainable nature of the office will lie in the lower rent TNT will charge, the fact that it will be CO2 emmission-free, and the long term guarantees the consortium will give over the sustainability of the offices.

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GO! Express & Logistics opens high-performance hub in Central Germany

Posted by | Jan 17, 2008 | |

GO! opens new hub in Niederaula German express company GO! Express & Logistics has opened a new EUR 7 million sorting centre in Niederaula, Central Germany. After eight months of construction, the new hub was put into operation in the night from 11 to 12 January 2008.

The hub is due to the positive development of parcel volumes with continuous double-digit growth rates, the company said. GO! decided to expand after its current hub in nearby Neuenstein reached its capacity limits of 10,000 parcels a day in a time-frame of 3 hours.

“With the new hub we have now created a central handling point that has enough capacity for the next 10-15 years due to the modular system in terms of area and sorting technique,” said GO! CEO Ralf-Hans Dierks. The ceremonial opening is planned for this spring.

The 30,000 sqm facility provides a 3,600 sqm handling terminal with a completely automatic sorting system. Capacity is designed for 6,000 parcels per hour in the beginning and can be expanded to 15,000 parcels.

The main installation of the central hub is a high-performance sorter that handles parcels in a sensitive way. All the information is transported via a central volume, weighing and scanning system to the packages. The whole facility can be expanded through additional sorters and has been built with space for future extension.

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DHL to pay Contractors USD 25M (US)

Posted by | Jan 16, 2008 | |

DHL will pay USD 25 million to settle a national class-action suit by some 1,400 contractors stemming from payment disputes dating back to 1994, according to company officials and one of the lawyers representing one of the contractors.

The contractors alleged that glitches in the DHL computer system – a legacy from Airborne Express, which DHL bought in 2003 — prevented certain types of shipments from being processed correctly, said R. Anthony Rupp III, a lawyer with the Buffalo firm of Rupp Baase who represented contractors involved in the case.

While linking data from shipments from across the country with confirmation information, the DHL system also mistakenly prevented any payment for those jobs, the lawsuit alleged.

DHL denies any such glitches in its computer system. “There are none,” said Josh Frank, DHL vice president of legal.

The company agreed to the settlement, Frank said, because such class action lawsuits can be distracting an expensive.

In an internal memo to DHL managers obtained by Traffic World, the company said it had settled “to avoid prolonged and expensive litigation” with a one-time payout that it hopes “as many contractors as possible” will pursue.

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