DHL looks to expand overseas shipments from the U.S.
Deutsche Post’s DHL is looking to expand overseas shipments from the United States, a senior U.S. manager said.
James Cameron, executive vice president of operations, said Plantation-based DHL has posted a ”slight uptick” in U.S. package volume. However, he added, DHL doesn’t necessarily want to be as big in the United States as FedEx and UPS. ”The scope of what we have is nowhere near the two big giants in the U.S.,” said Cameron.
DHL, a unit of Deutsche Post, Europe’s largest postal service, has spent more than $2 billion in the United States since 2003. DHL said in December it didn’t expect to break even in the United States until 2009.
DHL held about 2 percent of the U.S. ground delivery market at the end of 2006, with UPS controlling 68 percent and FedEx with 18 percent, according to Rick Paterson, an analyst with UBS Investment Research in New York. The U.S. Postal Service and other firms have the rest.
Deutsche Post, based in Bonn, labeled DHL’s U.S. unit its ”weakest performer” in December.
”DHL just does not compete with FedEx and UPS when it comes to service and reliability,” Daniel Ortwerth, an Edward Jones & Co. analyst in St. Louis, said. “The U.S. customer just does not tolerate that.”
Satish Jindel, president of Pittsburgh-based SJ Consulting, said he expects DHL to stick with its strategy of retaining the business it has already won in U.S. ground shipping for at least the next two years, until it is profitable.
DHL’s U.S. division has more than 21,000 employees and contracts for its air lift with closely held Astar Air Cargo, based in Miami, and ABX Air, based in Wilmington, Ohio. As a foreign-owned company, DHL is prohibited from owning a U.S. airline.
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