BONN: August 03, 2016. Deutsche Post DHL is to invest US$137 million in U.S. domestic and cross- border e-commerce in anticipation of a US$1 trillion global market by 2020.
The announcement coincides with the logistics group reporting a 43.7 percent rise in earnings for the first half of 2016 (H1) to €1.18 billion on revenue of €28.06 billion – a drop of 4.8 percent compared to the same period last year.
However the group's largest division, post/e-Commerce/parcel (PeP), produced a 5.0 percent increase in revenue to €8.2 billion for H1 and an EBIT of €659 million – a year-on-year rise of 39 percent.
"Having posted the strongest second quarter in our history, we remain well on track towards achieving our targets. Our Post/eCommerce/Parcel division in particular contributed to the positive trend," said group CEO Frank Appel. "PeP management is continuously expanding the division's market-leading position through future-oriented investments and trend-setting innovations," he added.
With new and planned fulfillment centers in Los Angeles, Columbus, Ohio and New Jersey, DHL eCommerce CEO Charles Brewer noted: "There is barely any other industry that provides such a promising outlook than the e-commerce business. It is expected that one billion people will shop online and across borders by 2020 with the U.S. being the most popular origin for 25 percent of consumers worldwide."
DHL estimates the current global B2C cross-border e-commerce market at US$400 billion and expects it to expand 28 percent a year to 2020.
The company anticipates consumers will increasingly buy products online that are either unavailable or too expensive in their home country. With the largest demand reverting to U.S. e-commerce retailers because of a 'Made in the USA' label, DHL says the US$137 million will be used to build eight new distribution centers and enhance two existing facilities in Los Angeles and Columbus, Ohio.
"For consumers shopping abroad, and also for businesses, it is of utmost importance that international deliveries are reliable, safe and convenient. We provide that with our network every day in every way," Brewer claimed.