Tag: Korea

UPS to assume full control of operations in Korea

Posted by | Jun 18, 2008 | |

UPS today announced an agreement with The Korea Express Co., Ltd. (KEC) to acquire KEC’s interest in the UPS-KEC express joint venture company here. The transformation of the joint venture to a wholly-owned subsidiary will allow UPS to grow its business in Korea and better serve its customers in a key market.

Terms of the deal were not disclosed.

“UPS and KEC have had a successful partnership in Korea for more than 10 years, but UPS has arrived at a point where we need greater flexibility to match our commitment to this important market,” said Derek Woodward, president of UPS’s Asia-Pacific Region, noting Korea now is America’s 7th largest trading partner.

The two companies also signed a cooperation agreement for continued collaboration. It recognizes UPS’s global network and infrastructure and KEC’s local network and customs brokerage operations.

UPS expects to enhance its levels of reliability and to further build its brand presence in Korea. As part of its strategy to provide total integrated logistics solutions, UPS will begin integrating its Supply Chain Solutions operation with the newly-formed package express entity to offer a single UPS branded portfolio.

Earlier this year, UPS rolled out a series of new services to better serve Korean customers including a simplified suite of three services for shipping international air freight. The suite includes a substantially expanded express freight option with guaranteed door-to-door service. By combining the capabilities of the world’s 9th largest airline with UPS’s position as a global freight forwarder with access to other airlines, UPS is the only transportation and supply chain provider offering guaranteed integrated air freight services in a single portfolio.

UPS began operating in Korea in 1988. The company operates 31 weekly flights to and from Incheon Airport using B-747, B-767 and MD-11 aircraft connecting Seoul to Qingdao, Shanghai, Taipei and Anchorage.

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Korea Express says to hand local JV stake to UPS

Posted by | Jun 17, 2008 | |

Korea Express Co Ltd, a country logistics company, said it had signed a deal to hand its 40 percent stake in a local joint venture to United Parcel Service Inc .

It did not disclose the value of the transaction.

Atlanta-based UPS had owned 60 percent of UPS-Korea Express, launched in 1996.

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More consolidation ahead in Korean CEP sector

Posted by | May 20, 2008 | |

The South Korean domestic express delivery market is heading for more consolidation after a series of deals over the last year, according to experts. Large conglomerates are entering the market, resulting in tougher competition and falling profits for medium-sized players.

Although the four largest parcel carriers are estimated to have 60% of the market, there are still a large number of smaller players. However, recent moves by industrial conglomerates to enter the market have intensified competition, the Korea Times newspaper reported recently.

The Big Four are Korea Express, Hyundai Express, Hanjin Express and CJ GLS. Korea Express regained leadership of the domestic express parcel market from Hyundai Express in 2007, closely followed by the other two major players.

The biggest transaction in the market recently was the acquisition of Korea Express by the Kumho-Asiana group. Hyundai Express is part of Hyundai Logistics, the logistics division of the international automotive group, while Hanjin Express is part of the Hanjin Group, owner of Korean Air and the Hanjin container shipping company.

The common factor is that the large Korean conglomerates see the parcel sector as a growth market, especially for home deliveries of consumer products bought via the internet or TV, while they also believe they can reduce their internal logistics costs by owning a delivery company.

One consequence is that market players are reducing prices to try to keep or grow their volumes, leading to lower profits. This, in turn, is creating more potential for market consolidation.

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Korea Express overtakes Hyundai as top Korean parcels firm

Posted by | May 2, 2008 | |

Korea Express has overtaken Hyundai Express to regain its former position as the largest domestic parcels company in South Korea, according to local newspaper reports.

The company, recently bought by the Kumho-Asiana group, ended 2007 with sales of 293 billion won (EUR 187 million) and delivered 132 million packages. It also achieved a 5 pct operating profit which was higher than then other three operators, according to official company reports.

This put it ahead of previous domestic market leader Hyundai Express which had sales of 286 billion won (EUR 183 million) and 120 million packages. The third largest parcels company was Hanjin Express, with sales of 252 billion won (EUR 161 million), followed by CJ GLS, with 184 billion won (EUR 118 million), according to the reports.

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Korea Post Tops Brand Rankings

Posted by | Mar 4, 2008 | |

Korea Post beat private logistics companies by large margins to be named as the best package delivery service in Korea for the fourth consecutive year.

The Korean Management Association (KMA) announced Tuesday that the government post service scored 596.7 points in its annual Brand Power index, far ahead of private firms such as Hanjin (499.5 points), Korea Express (441.2 points) and Hyundai Express (413.4 points). The KMA report is considered the most credible consumer survey index in Korea.

“It’s the trust of the people that gave us the honor of being first for four straight years,” said Jung Kyung-won, president of Korea Post. “We will continue to expand our logistics infrastructure to raise our national competitiveness and service to the public.”

Korea’s door-to-door package delivery service market has seen extensive competition between the public postal service and private firms such as Hanjin, CJ and GS. Korea Post has excelled in customer satisfaction with the introduction of customer-oriented services such as weekend delivery, morning delivery and airport delivery, the survey said.

This year, Korea Post is also seeking to establish a next-generation logistics system called u-POST (ubiquitous post), based on the synchronization of information with mobile technologies, radio communications and radio frequency identification (RFID) systems. It has been cooperating with the Korea Electronics and Telecommunications Research Institute to develop an RFID-based mail operations system.

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