DHL opens vital logistics center
Fitri Wulandari, Hong Kong
Leading express and logistics company DHL opened on Wednesday its largest center for air express cargo in the Asia-Pacific to gain more from the fast-growing intratrade in the region.
John Mullen, DHL Express chief executive officer for Asia- Pacific, said the firm had recorded impressive growth in the region over the past several years and the US$100 million new Central Asia Hub facility was expected to further boost the firm's business expansion in the region.
"DHL has been experiencing strong double digit growth in the Asia-Pacific region over the past five years. Intra Asia-Pacific cargo volumes accounted for half of the total DHL Express revenue in 2003.
"Recognizing the potential of the logistics market in Asia, DHL has been pursuing a growth strategy. The construction and operation of the new Central Asia Hub is an extension of this strategy," Mullen said in a media briefing.
Located in Hong Kong International airport, the facility occupies 18,200 square feet (21,770 square meters) of land and is capable of handling 440 tons of air cargo express daily and 20,000 shipments per hour in 2004. The new hub is in addition to DHL's existing five hubs in Bangkok, Seoul, Singapore, Sydney and Tokyo.
Mullen did not give details about how much the hub would boost the company's growth or revenue, but DHL registered a total revenue of 22 billion euros in 2003, almost 50 percent of which came from the Asia-Pacific region.
According to the Boeing World Air Cargo Forecast, trade within Asian states will grow at an average of 8.4 percent a year, which is faster than the growth between Asia and North America (7.5 percent) and between Asia and Europe (7 percent). Express volume within the Asia-Pacific region is expected to grow up to 50 percent this year.
The choice of Hong Kong to serve as the company's largest hub is mainly based on its strategic location as shipments can be made, on average, within four hours to major cities in the Asia- Pacific.
"When it comes to connectivity, Hong Kong is second to none. Already, over 60 percent of express cargo processed by the Central Asia Hub are intra Asia-Pacific shipments.
"It clearly reflects the important role that Hong Kong plays as a conduit for international and intra Asia-Pacific trade," Mullen said.
The hub is also expected to increase shipments to the company's key market, China, where DHL continues to register an annualized growth rate of between 35 percent and 45 percent over the past few years.
In the first half of this year, DHL, which is fully owned by Deutsche Post World Net, increased its business in China by between 50 percent to 60 percent. More than 70 percent of DHL's shipments to and from China are made through Hong Kong.
The hub will also support expansion of the company's dedicated air network which currently serves 25 destinations in 16 countries.
In the first half of this year, DHL added Ho Chi Minh City and Jakarta to its Asia network. It plans to add up to 4 cities into the network in the second half of 2004.