DHL Express Germany will increase its prices by 3% on December 1 despite the slowdown in theexpress market and uncertainty over prospects for next year, a senior manager told CEP-Research in
an interview. The company remains optimistic for the medium-term, however.Increasing costs, including fuel and general costs, made a price increase necessary after aperiod of trying to absorb the increases through operational optimisation, Tobias Wider, head ofmarketing and strategy at DHL Express Germany, said. “The average increase will be 3%. We think itis a moderate increase,” he commented. DHL expected competitors would also increase prices, headded.
DHL Express Europe announced in early October that there will be a general rate increase of4-5% as of December 1 due to inflation and rising costs, but that each country will decide on itsown price increase based on inflation and local market conditions. DHL Express France, for example,will put up air express prices by 4.2% and ground express rates by 5.9% (as of January 2009).
Asked about the impact of the financial crisis on the express business, Wider said: “There isno slump. There is uncertainty, and no one knows for how long there might be no growth. We have tobe ready for low growth over the next 12 months. In the medium-term, however, the outlook ispositive.”
DHL Express is growing in line with the German market, Wider stressed. Market growth in theinternational express segment was slowing, and European business was likely to grow at similarrates to the domestic market in future, he noted. But DHL Express remains well-positioned due toits wide-range of next-day delivery options and additional services for customer-specificsolutions, he emphasised.
Echoing recent comments by senior executives of major integrators, Wider said that customersare increasingly looking for express providers who can also offer day definite delivery options. “We feel day definite will develop better than classic premium express,” he commented.
DHL Express was benefiting from the transfer of the day definite road express business fromDHL Parcel Germany early this year, he noted. Another competitive advantage was the relocation ofthe European air hub from Brussels to Leipzig, Wider said. “We can offer faster transit times,later pick-up times and have an improved quality performance.”
In terms of products, DHL Express Germany plans to re-brand its domestic products in linewith international product names which focus on delivery times, Wider said. The new internationalday definite product, Economy Select, which is currently only offered to the USA, will be extendedto more intercontinental destinations, he added.
