Tag: International

FedEx and UPS eye U.S. slowdown

Posted by | May 1, 2008 | |

Package shipping giants FedEx Corp and United Parcel Service Inc are walking a narrow path between expanding their businesses overseas and scaling back in the United States, where the economy has slumped.

But industry analysts say the two rivals should be able to weather a short-term slowdown without hefty drops in profits, with only a prolonged U.S. downturn presenting a serious threat.

Recessions push companies and individuals to rein in expenses, which includes package shipping. But revenues are not the only wild card for UPS or FedEx profits. The record surge in fuel prices for trucks and airplanes is another.

Like many U.S. transport companies, UPS and FedEx have been routinely passing on higher fuel costs to customers. But in a recession, such surcharges are just one more reason for customers to cut shipments.

Rising fuel costs also present big challenges to the shippers just in managing cash flows and hedging.

While Graf says FedEx has leeway in allocating its capital expenditures, growing markets like China remain a priority.

FedEx’s total capex spending should be about USD 3 billion for the fiscal year beginning on June 1, he said.

As part of its expansion plans, FedEx will open a new air hub in Guangzhou, China, in 2009.

At UPS, overseas spending that includes the booming China market will also remain core to its strategy in 2008 and 2009.

UPS’s new airport hub in Shanghai will open this year.

In their latest quarters, net profit declined 12 percent at UPS and fell 7 percent at FedEx. Both cited the sluggish state of the U.S. economy and high fuel costs.

Both companies still derive about three-quarters of their business from the United States, said Morningstar analyst Keith Schoonmaker.

The good news, highlighted by both, was growth in international package shipments, including a boost from rising U.S. exports on the back of the weak U.S. dollar.

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TNT launches Australia’s first hybrid truck fleet

Posted by | May 1, 2008 | |

TNT Express Australia has become the first business in Australia to start operating a fleet of diesel-electric hybrid trucks as replacements for conventionally powered vehicles.

TNT has put 10 Hino Hybrid trucks into service as part of its commitment to achieving better environmental outcomes across all areas of its business – particularly the reduction of CO2 emissions.

Roger Corcoran, TNT Express Australia Managing, says the decision to adopt hybrid trucks is part of the company’s global commitment to reduce its total CO2 emissions.

Speaking at the official launch of the hybrid truck fleet in Sydney, Corcoran says the new vehicles will reduce TNT’s greenhouse gas emissions by an average of 1,600 kilograms of CO2 a year per vehicle.

He says the Hino Hybrid will emit 14 percent less carbon dioxide than a diesel-powered truck of equivalent size.

“In addition, the hybrid vehicle reduces emissions of nitrous oxides by almost half and harmful particulate matter by 98.9 per cent,” Corcoran says.

The introduction of hybrid vehicles is part of TNT’s commitment to reducing greenhouse emissions, according to Corcoran.

Under its code orange commitments, TNT has mandated across its business to buy operational vehicles with the highest environmental standards.

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UPS appoints two key posts in Europe

Posted by | Apr 30, 2008 | |

Romaine Seguin, a 25-year veteran of UPS who has been leading the company’s South Europe District, has been promoted to Vice President of Operations for UPS’s entire Europe Region. In her new role, Seguin will be responsible for small package operations in 47 countries and territories throughout Europe, the Middle East and Africa.

Cindy Miller, a 20-year veteran of UPS who headed the Metro Chicago District, has been named Vice President of Operations for the company’s South Europe District. In her new role, Miller will be responsible for small package operations throughout Italy, Spain, Portugal, Greece, Bulgaria, Romania, the Balkans, the Middle East and Africa.

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Spree of acquisitions on courier service market in Romania

Posted by | Apr 29, 2008 | |

The Romanian courier services market has seen several acquisitions since the beginning of the year that have introduced major players such as UPS and the French Post Office on the domestic market, while the German Post Office has strengthened its position, and the Austrians remain interested in the market. So what is in store for the courier services industry?

Domestic couriers had announced as early as two years ago that they planned to attract strategic investors or investment funds to further develop some businesses on one of the most dynamic markets in Romania

Still, the first deals were only clinched as late as at the beginning of the year. The spree of acquisitions started with the direct entrance of UPS in Romania, through the acquisition of Trans Courier Service, and continued with the biggest deal sealed so far on this market, the sale of Cargus to DHL.

While the German Post Office provider acquired Cargus to strengthen its presence on the market, the French Post Office in turn took over a company to enter the Romanian market. Thus, the courier service unit GeoPost and Turkey’s Yurtici Kargo took over 80% in Pegasus, in a deal ZF estimates at 6-9m euros.

Domestically, sale announcements also came from TCE Logistica and Curiero. While TCE representatives are preparing to start talks, Curiero has already reached an agreement with Asesoft for a 25 pct stake.

Smaller companies on the market, such as Sprint Courier, Concorde Courier, Alo Courier, Nemo Expres and Roexpres, are also likely to be the target of some acquisitions in the following period considering the large investments required to support growth and remain competitive.

In addition, a rising number of foreign shipping, courier and logistics companies are interested in the domestic market, which includes the Austrian Post Office.

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trans-o-flex puts European network on new footing

Posted by | Apr 29, 2008 | |

trans-o-flex have laid a new foundation for their European distribution network Eurodis. “We have re-launched Eurodis GmbH, the management company of our specialist 21-country network,” explains Klaus J. Heinz, Executive Board Chairman. “Now we are in a position to welcome our key international partners as shareholders with similar rights and obligations and to involve them in the development of the network.” Redur Lozano, the Spanish Eurodis partner, has already taken this up and acquired a 20 pct stake in Eurodis GmbH. At present, trans-o-flex and the Austrian Post each hold 40 pct of the stock, but they are prepared to halve their holdings to take other partners on board.

While other international networks are usually managed and controlled from a single national perspective, Eurodis can become the first truly international alliance thanks to the equitable shareholding structure, according to Heinz. “Our target is to offer Spanish solutions in Spain, English ones in England and French solutions in France.” Equally, the cross-border ownership of shares serves to reinforce the partners’ mutual ties.

In parallel to the changes on the capital side, the role and functions of Eurodis GmbH are growing. Apart from its coordination aspect, it will in future also manage and control the international alliance. It will manage the partners and the financial adjustments between them, known as clearing, and be responsible for international shipment track and trace and the further development of it.

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