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Carrying the load

Released at: 10:37, 23/03/2015

Carrying the load

After some three decades in Vietnam, DHL, the world's leading postal and logistics group, has affirmed its prime position in the country, recording continued strong growth.

by VET

DHL was the first express carrier in Vietnam when it arrived in 1988. The company still plays the biggest role in the country’s logistics network, with ten facilities, two of which connect the ground network to air operations, providing high quality services to Vietnamese customers. DHL has more than 450 international specialists and serves around 12,000 customers.

The company’s transport network is also the most extensive in the industry, with 143 vehicles and daily flights providing same-day uplift and next day connectivity to all of Asia.

DHL undertakes 2,760 shipments a day, connecting over 220 countries and territories and 120,000 locations around the world.

Despite Vietnam’s economic downturn spanning several years, DHL has continued to grow steadily and increase its investments in the country, facilitating trade in and out of the country.

In a study commissioned by DHL in 2014 - the third edition of the Global Connectedness Index (GCI) - Vietnam’s global connectedness was found to be recovering to pre-financial crisis levels, standing out for its high depth scores relative to the structural characteristics of its size and level of economic development.

The GCI study is a detailed analysis of 140 countries, measuring the depth and breadth of connectedness by cross-border flows of trade, capital, information, and people.

“When the going gets tough, our customers need a reliable partner to help them reach their markets and source their materials, and we are committed to being there for them,” said Mr. George E. Berczely, General Director of DHL Express Vietnam.

Slow growth periods resulted in a few of the smaller operators cutting costs, cancelling flights, and reducing services, but DHL continued to provide high quality services to customers.

In 2014 it announced the launch of a new Country Office and South Service Center in Vietnam, the biggest of its kind in the country. The $10 million facility, located near Vietnam’s largest international gateway, Tan Son Nhat International Airport in Ho Chi Minh City, was built to meet the growing demand in the southern region for quick and reliable international services.

The new facility occupies almost 5,000 square meters, twice the size of the former facility. With this additional space the company has doubled its shipment capacity in Vietnam’s southern region.

The expansion of the warehouse and the upgrade of the building allows DHL to operate more efficiently, delivering shipments earlier and picking them up later. There is also an advanced security system installed that provides management with high-end technology.

The facility is a sign of DHL’s commitment to the future development of Vietnam and is the company’s largest investment in the country to date. According to Mr. Berczely, the facility is a strong statement of DHL’s long-term commitment to Vietnam, its business sector, and its people. In addition to the new office and service center, DHL recently launched a new intra-Asia network flight connecting Hanoi and Hong Kong. Operated by K-Mile Air of Thailand, a partner of DHL, the flight, which utilizes a newly-converted Boeing B737-400SF freighter with a gross payload of 21 tonnes, flies five times a week.

The new route shortens the transit time for shipments on the DHL intra-Asia network to and from Hanoi to just one day, allowing businesses and consumers to enjoy the earliest arrival time to and latest departure time to and from the city. This new flight, combined with the expansion of the direct pick-up and delivery capabilities to the Thai Binh - Nam Dinh area, allows DHL to better support the growth potential in the north of the country.

Besides the new facility and flight, DHL will also improve its service quality by increasing the number of transaction points in key areas and adding 43 vehicles to its delivery team, to shorten the time for receiving orders and delivery.

DHL now has two service centers, in Hanoi and Ho Chi Minh City, two gateways, and more than ten service points. The company offers delivery services on 77 domestic and 64 international flights weekly, including daily flights from Hong Kong - Ho Chi Minh City - Hong Kong on A300-600 aircraft with a capacity of over 40 tonnes on each flight.

It plans to continue its investments in Vietnam to maintain its leading position in the country’s international express market. The company has based its expectations on Vietrade figures for the country’s total export revenue, of almost $71 billion in the first half of 2014, which was a 15 per cent increase compared to the same period of 2013.

Moreover, the latest EuroCham Business Climate Index showed that business confidence and outlook among European businesses in Vietnam has continued to grow. Further improvements in infrastructure, legal framework, and government policies also make Vietnam an ever more attractive market with strong growth potential for DHL Express.

In addition, with the upcoming EU-FTA 2015 and the TPP there will be significant growth in Vietnam and the company wants to be ready. DHL’s primary focus this year is, therefore, investing in its air and ground networks and expansion. “There’s a lot of market share we can capture by better tailoring our services, for example providing services for the small and medium-sized enterprise (SME) sector or focusing on specific trade areas,” said Mr. Berczely.

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