DHL Express has announced that it is investing EUR 690 million between 2020 and 2022 to build or expand its facilities in key growth markets of Australia, Japan, Hong Kong and South Korea. It also intends to spend close to EUR 60 million to bolster its Asia Pacific air network.
DHL Express expects shipment volumes in Asia Pacific to be 30-40% larger than last year’s peak season, which typically starts around November and lasts until Lunar New Year. “These investments are testament to our continued confidence in the region. They are crucial not only in the near term as we expect to tackle an unusually strong peak season, but it will make sure that we are well-positioned in the long run to keep global trade running as e-commerce and cross-border trade grow,” said Ken Lee, CEO of DHL Express Asia Pacific.
The expanded infrastructure and new flight routes across Asia Pacific will help the company tackle the unprecedented growth in shipment volume and address the ever-growing demand for time-definite express deliveries. Since the start of 2020, DHL Express has experienced a 50% surge in e-commerce shipments in Asia Pacific (excluding China).
The new Kuala Lumpur Gateway in Malaysia, which is almost triple the size of DHL Express’ current facility, will increase the company’s processing capacity by more than 200%. The EUR 39.4 million facility will be situated at the Kuala Lumpur International Airport and is scheduled to be completed by 2022.
The Osaka Distribution Center in Japan scheduled to be opened by the end of 2020 will be DHL Express’ largest distribution facility in the country. With an investment of EUR 71.4 million, it will have 21,000 square meters of floor space and is equipped with a state-of-the-art sorting system and X-ray inspection machines.
The company’s Central Asia Hub in Hong Kong, one of DHL Express’ three global hubs, has a EUR 377 million expansion underway that will boost warehouse space by 50% to 47,000 sqm and increase the hub’s annual throughput to 125,000 pieces per day. This means that the hub will be handling six times more in terms of shipment volume than when it was first opened in 2004.
Furthermore, a EUR 131 million planned investment in Incheon, South Korea will boost shipment processing capacity by approximately 160%, equipping it to service demand from some of the region’s most advanced economies. The expansion will almost triple the facility’s gross floor area to 58,700 sqm, making it DHL Express’ largest gateway in Asia Pacific.
At the same time, construction of a new gateway facility in Bangalore, India is underway, slated to be ready by 2021.
“The pandemic has caused unparalleled changes to the air cargo industry and it will likely take a long time for the industry to recover to pre-pandemic levels. The growth in e-commerce shipment volumes will continue to outpace the available air cargo capacity in the industry, strengthening the case to invest in adding new dedicated aircraft to our fleet, open up new routes, and supplement our fleet with charter flights,” said Sean Wall, Executive Vice President, Network Operations & Aviation, DHL Express Asia Pacific.