DHL Express, the world’s leading express service provider,announced today that it is investing circa EUR 690 million between2020 and 2022 to build or expand its facilities in key growthmarkets of Australia, Japan, Hong Kong S.A.R. and South Korea.Equally, it intends to spend close to EUR 60 million to bolster itsAsia Pacific air network such as introducing direct, new (e.g.Vientiane, Yangon), and frequent (e.g. Oceania) flightroutes.
DHL Express expects shipment volumes in Asia Pacific to be30-40% larger than last year’s peak season, which typically startsaround November and lasts until Lunar New Year. “These investmentsare testament to our continued confidence in the region. They arecrucial not only in the near term as we expect to tackle anunusually strong peak season, but it will make sure that we arewell-positioned in the long run to keep global trade running ase-commerce and cross-border trade grow,” said Ken Lee, CEO of DHLExpress Asia Pacific.
The expanded infrastructure and new flight routes across AsiaPacific will help the company tackle the unprecedented growth inshipment volume and address the ever-growing demand fortime-definite express deliveries. Since the start of 2020, DHLExpress has experienced a 50% surge in e-commerce shipments in AsiaPacific (excluding China).
North Asia investments
The Osaka Distribution Center in Japan scheduled to beopened by the end of 2020 will be DHL Express’ largest distributionfacility in the country. With an investment of EUR 71.4 million, itwill have 21,000 square meters (sqm) of floor space and is e a state-of-the-art sorting system and X-ray inspectionmachines.
The company’s Central Asia Hub (CAH) in Hong Kong S.A.R.,one of DHL Express’ three global hubs, has a EUR 377 million expansion underway thatwill boost warehouse space by 50% to 47,000 sqm and increase thehub’s annual throughput to 125,000 pieces per hour. This means thatthe hub will be handling six times more in terms of shipment volumethan when it was first opened in 2004.
Furthermore, a EUR 131 million planned investment in agateway facility in Incheon, Seoul, South Korea willboost shipment processing capacity by approximately 160%, e to service demand from some of the region’s most advancedeconomies. The expansion will almost triple the facility’s grossfloor area to 58,700 sqm, making it DHL Express’ largest gateway inAsia Pacific.
South & Southeast Asia investments
In Bangladesh, DHL Express is investing ~EUR 25 million tobuild a new facility that will combine its country office andservice center into a 10,000 sqm site. The new facility will bringabout an approximate 35% increase in shipment processing capacity,and is expected to be opened in Q1 2022. The new Kuala LumpurGateway in Malaysia, which is almost triple the size of DHLExpress’ current facility, will increase the company’s processingcapacity by more than 200%. The EUR 39.4 million facility will besituated at the Kuala Lumpur International Airport and is scheduledto be completed by 2022. At the same time, construction of a newgateway facility in Bangalore, India is underway, slated to beready by 2021.
Utilizing a brand new Boeing 777-200LRF with a capacity of up to102 tons, DHL Express now flies four times a week from its US hubin Cincinnati and the Los Angeles gateway to the DHL Express SouthAsia Hub in Singapore, via Sydney. The dedicated route shortenstransit time for shipments to and from the US, and allows DHL tooperate with greater efficiency while meeting the mounting demandfor express deliveries.
Oceania investments
Many SMEs in Australia and New Zealand, which have traditionallyrelied on economy services, are increasingly switching to expressdelivery services. This trend has led to a more than 40% increasein DHL Express Australia’s inbound and outbound volumes since May2020. DHL Express has significantly increased its number ofdedicated flights to and from Australia to around 30 regularservices per week, compared to 10 before the Covid-19 pandemic hit.This includes a new flight that connects Melbourne, Auckland andChristchurch, as well as a new 4x-a-week flight between Hong KongS.A.R. and Sydney.
In September, the company launched its EUR31million SydneyService Center, which is double the size of the previousfacility and is e with an automated high-speed sortingsystem that processes up to 4,300 shipments per hour. By end 2021,DHL Express will kick start operations at the expanded BrisbaneGateway and Service Center, in which the company will spend EUR13.2 million to increase floor space by 148% and double itsprocessing capacity. New and expanded facilities are also beingplanned for Melbourne and Adelaide in the nearfuture.
“The pandemic has caused unparalleled changes to the air cargoindustry and it will likely take a long time for the industry torecover to pre-pandemic levels. But having a dedicated fleet andwell-implemented contingency plans have helped to keep our networkfully operational despite the overnight disappearance of commercialair belly cargo space. The growth in e-commerce shipment volumeswill continue to outpace the available air cargo capacity in theindustry, strengthening the case to invest in adding new dedicatedaircraft to our fleet, open up new routes, and supplement our fleetwith charter flights,” said Sean Wall, Executive Vice President,Network Operations & Aviation, DHL Express Asia Pacific.
DHL Express currently has 23 dedicated aircraft in its AsiaPacific fleet, and operate approximately 1,040 flights per day. Thecompany will be adding a new Airbus A330-300P2F to its Asia Pacificfleet in February 2021, as well as a new Boeing 737-800F in March2021. Globally, the company has increased the number of its dailyflights significantly. This includes four new Boeing 777F wide-bodyaircraft that were put into service just this year, with two moreexpected to be delivered next month. These six additional aircraftwill enable DHL Express to carry out more than 3,000 additionalintercontinental flights per year.