The Malaysian express market will continue to grow at good rates in the future as the country seeksto position itself as an important Asian transportation hub, a senior industry executive said.
The country’s express market, with turnover of US$ 328 million in 2005, is expected to growat about 6% in 2006 and again in 2007 in line with national GDP growth, Teong Teck Lean, presidentof the Association of Malaysian Express Carriers, told last week’s Asia Pacific Mail & Express2006 conference in Singapore.
Citing official data, Teong described DHL and FedEx as the market leaders in Malaysia aheadof UPS and TNT. The “Big Four” had a combined market share of about 66%, the five largest domesticcompanies had about 19% and PosLaju, the Pos Malaysia express unit, had about 10%, he said. About100 small licensed courier firms shared the remaining 5% of the market.
Teong, who is CEO of the largest domestic company, GD Express, said that Malaysian-ownedexpress companies would increasingly need capital and IT expertise in order to compete effectivelywith the leading international players in the future. There was a clear need for “smartpartnerships” between national and international players, he commented.
Demand for express services in Malaysia, the world’s 17th largest trading nation, wasgrowing, Teong pointed out. Factors such as a vibrant economy, continued foreign investment,increasing international trade and rising disposable income all benefited the industry. The stablegovernment, excellent infrastructure and good geographical location were other strengths, hepointed out.
But the express business also faced several challenges, including a declining supply of “express-compatible” workers as more and more Malaysians sought jobs abroad, he noted. Costs wererising due to higher oil prices, and general industry consolidation meant that key customers weregetting bigger but also fewer. Average domestic corporate express prices had fallen about 20% since1985 due to these factors and more intense competition.
