DHL Express is seeing rising volumes this year and is not planning to cut back air capacity fromAsia to Europe this autumn in contrast to rivals TNT and FedEx, a senior executive said today.
“We are preparing for the peak season. We do not see a contraction in the market and we do notsee a decline in terms of volumes from Asia to Europe,” John Pearson, CEO DHL Express Europe, saidat a European media briefing in Leipzig, noting that DHL Express volumes are above the pre-crisislevels of 2008. However, he stressed: “We are not making any aggressive forecasts at present.”
Roy Hughes, managing director hubs and gateways Europe, added: “We have not scaled back on Asiaintercontinental routes. We are not seeing a reduction in volumes, we are still growing.” MarkusOtto, vice president DHL Aviation Germany and head of the company’s Leipzig-based airline EuropeanAir Transport, commented that capacity of the worldwide fleet, comprising 89 dedicated aircraft,would increase about 10% next year once the new Airbus 300 freighters were delivered, even thoughthe number of planes would remain stable.
Their comments mirror those of Deutsche Post DHL CFO Larry Rosen earlier this week who said thatDHL Express was not seeing any slowdown in Asia and did not plan to reduce capacity in the region.FedEx recently said it has seen a drop in Asia exports and is reducing air capacity out of theregion, while TNT Express said yesterday that Asia-Europe demand remained weak in the thirdquarter, with soft pricing, and it was “optimising” its intercontinental capacity.
Asked whether DHL Express was considering any major acquisitions, including possibly even TNTExpress, Pearson stressed: “There are no major acquisitions planned within the next 12 months.” Theinternational express market leader had “uncluttered” its business by divesting activities, hadclearly focused on time-definite international deliveries as its core competence, and was nowdelivering “the right financial results”, he added. In 2010, DHL Express had an operating profit of€497 million on revenues of €11.1 billion.
In Europe, DHL Express has successfully regained market share in recent years and now claims tohave 38% of the international express market, ahead of UPS (23%), TNT (16%) and FedEx (11%),Pearson stressed. “We are growing in Europe and have taken back some market share,” he said. “Ourcompetitive position in Europe has strengthened in the last 2-3 years.”
This had been achieved through a combination of high service levels and more competitivepricing, he explained. “In the past we were not competitive enough on pricing. Now we are morecompetitive,” he commented. DHL was ahead of its three direct competitors in terms of customersatisfaction and loyalty, he claimed.
Pearson, who has spent 23 of his 25 years at DHL Express outside Europe and took up the EuropeCEO position last year, highlighted the company’s determination to differentiate itself throughcustomer service, high performance levels and its international network. “You cannot reallydifferentiate yourself through the fleet or technology. Speed is not really a differentiator. Butwe are the most international company and that is our competitive strength.” Moreover, theextensive training of 100,000 staff as ‘International Specialists’, which he described as “thelargest training programme in the world”, would soon be completed, he added.
Looking ahead, Pearson highlighted several growth markets for DHL Express in the future,including high-tech, life sciences/pharmaceuticals, automotive and energy. These sectors allrequired reliable and fast international express transportation, and DHL could benefit from itsindustry expertise in these markets, he said.
