DHL invests B2.7bn in supply chain

DHL invests B2.7bn in supply chain

New warehouses, bigger fleet outlined

Kevin Burrell, chief executive of DHL Supply Chain Thailand, says the company plans to expand its footprint in Thailand, Indochina and Myanmar.
Kevin Burrell, chief executive of DHL Supply Chain Thailand, says the company plans to expand its footprint in Thailand, Indochina and Myanmar.

DHL Supply Chain, the world's leading logistics service provider, will invest 2.7 billion baht over the next three years to grow its footprint in this region.

The outlay is specifically earmarked for Thailand, Vietnam, Cambodia and Myanmar where the firm, part of Deutsche Post DHL Group, wants to tap growing logistics demand.

The investment will go towards building new warehouse facilities, expanding its fleet of trucks, and introduction of new technology.

That is expected to boost the company's combined warehouse space in those countries to 1.44 million square metres by 2020, creating 7,000 more jobs for a total of 17,000, said Kevin Burrell, chief executive of DHL Supply Chain for the Thailand cluster, which includes neighbouring states.

DHL Supply Chain is already a market leader in Thailand with a 25-30% share in the contract logistics segment where it covers.

It also is a top player in Vietnam where it intends to put to use 400,000 sq m of warehouse space and employ 3,000 people by 2020.

In July this year, the company was the first 100% foreign-owned logistics company to acquire an investment permit from the Myanmar Investment Commission.

The move enables it to establish a presence in the country with a 20,000 sq m warehouse, employing 500 workers.

The company will next concentrate on building a presence in Cambodia with a 20,000 sq m warehouse and manpower of 500.

However, it is Thailand where DHL Supply Chain intends to strengthen its presence, raising its warehouse space in 2020 to 1 million sq m from 650,000 sq m currently, while expanding its staff size to over 13,000 from some 10,000 now.

Mr Burrell said DHL's additional investment in Thailand will the widen the supply for a growing country, and an economy that is expected to return to accelerated growth. Government investment in megaprojects such as infrastructure, airport expansion plans and the Eastern Economic Corridor are attractive to foreign investors in Thailand, creating demand for DHL services.

According to Kasikorn Bank research, the value of Thailand's land transport and warehouse sector is expected to grow by 5-7% this year.

In Thailand, DHL claimed 10% growth in turnover in the first half this year, surpassing the industry growth's rate of 5-7%. The company targets sustaining annual growth of 10% over short term.

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