Dubai: DHL Express, an international logistics company, plans to build more air site and land site facilities in the Middle East, according to the company’s top executive.
DHL Express is part of postal and logistics group Deutsche Post DHL. The company, which has over 50 per cent market share in the Middle East, will invest 300-400 million euros in the region over the next three to five years, according to Ken Allen, global chief executive of DHL Express.
The company plans to build air site and land site facilities at Qatar’s Hamad International Airport. Construction is set to start this year. Nour Suliman, CEO of DHL Express for the Middle East and North Africa, did not divulge the size of investments for the project. It is also looking to build similar facilities at Kuwait International Airport.
Air site and land site facilities, as well as a new head office in Cairo, valued at 40 million euros, are expected to open on August 2. In Saudi Arabia, air site and land site facilities, as well as new head offices, are set to open in Dammam and Riyadh on September 7, and in Jeddah by the first quarter of next year. The projects are valued at 105 million euros.
DHL Express’ global revenue grew by 3-4 per cent in the first quarter compared to the same period in 2013, while profit climbed 12 per cent, Allen said, adding that the growth was impacted by exchange rates. In the Middle East, which accounts for around 20 per cent of the company’s total revenue, it expects to have double-digit growth in profit and revenue this quarter, according to Suliman.
Middle Eastern commercial shipments grew by 10-12 per cent in the first quarter compared to the corresponding time last year, Allen said.
According to him, in terms of capital expenditure, the company spends 700-800 million euros a year globally, with the Middle East accounting for 10 per cent of that.
UAE expansion
In the UAE, DHL plans to expand its facility at Dubai International Airport by 3,500 square metres. The expansion project is valued at 11 million euros.
The expansion will “cater for all the increased volumes. Some of the [shipments] will go on our aircraft and some will go on commercial aircraft,” Allen said.
On whether the company is looking to permanently move its operations to Al Maktoum International Airport, Allen said: “It depends on what the landing slots situation is and what happens to the commercial aircraft. If all the commercial flights and all the charter flights move then we’ll be prepared to move as well.”
The company currently operates six flights a day from Dubai International.
He said that operations have not been affected by the ongoing runway repairs at Dubai International, which runs until July 20.
On Thursday, the company opened its new Dh100 million ground operations facility at Meydan’s Racehorse district, which houses its new head office and a sorting and loading area. The facility covers 185,844 square feet.
Also, DHL plans to open at least six outlets in the UAE, where customers can drop off or collect shipment, in different areas by the end of the year.
The company currently operates 23 service points, mostly in big shopping malls, including Mall of the Emirates, The Dubai Mall, Ibn Battuta Mall and Deira City Centre. Three of the new outlets will be in Dubai, while the rest will be in other parts of the country, including Abu Dhabi and Ajman.
Meanwhile, in politically unstable countries in the region, including Iraq, Syria and Libya, Allen says business is “not very good.” However, he says the company does not plan to halt operations there, adding that if the political instability in these countries ease, it expects to build new facilities.
“We’re trying to get shipments in there whenever we can,” he said.
