BIZCHINA / Top Biz News
DHL plans investment of millions in China
By Lu Haoting (China Daily)
Updated: 2007-02-15 10:35
German air express and logistics giant DHL will invest more than $110
million in China over the next few years to maintain its leading position
and to capitalize on the country's continued growth in trade, the courier
announced yesterday.
The investment will be used to expand infrastructure, including more
transport vehicles and service center equipment, and for training its
employees.
The announcement was made by Klaus Zumwinkel, board chairman of Deutsche
Post World Net, DHL's parent company, during his latest North Asian trip.
Zumwinkel early this week announced investment commitments of over $90
million for Japan and $75 million for South Korea.
The new investment is a key initiative for DHL to enhance its position in
Northeast Asia, which will be the fastest growing transportation market
in the Asia-Pacific region by 2020.
DHL is considering setting up a North Asia hub in either Shanghai Pudong
International Airport or Incheon International Airport in South Korea.
An announcement on which airport is selected will be made by the second
quarter of this year, said Scott Price, CEO of DHL Express Asia-Pacific.
"There is still one last filter of analysis to do. It is a very close
race between the two (airports)," Price said.
DHL will make its final decision according to two factors speed and cost.
The speed consideration includes the ability to secure the correct air
timing, customs flexibility and efficiency, and the availability of a
bonded area to allow goods to move in and out quickly. New facilities are
also evaluated by labor and construction costs, and tax benefits.
DHL currently has a Central Asia hub in Hong Kong and South Asia hub in
Singapore.
The company's United States rivals, FedEx and UPS, both have plans to
build regional hubs in China. FedEx, previously based mainly in the
Philippines, will launch a new Asia-Pacific hub in Guangzhou Baiyun
International Airport in 2008.
UPS signed a memorandum of understanding with Shanghai Airport Group last
year to establish the UPS International Air Hub at the Pudong airport.
China is one of DHL's fastest-growing markets, accounting for 25 percent
of its revenue in the Asia-Pacific and 10 percent of its global sales.
DHL has maintained an annual growth rate of 35 to 45 percent in China in
the past years and has set up 73 branches, making it the largest network
among international express delivery firms in the country.
(For more biz stories, please visit Industry Updates)
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