DHL to turn Estonia into regional hub

  • 2005-06-29
  • By Ksenia Repson
TALLINN - DHL Express Nordic executives have announced their intention to expand the company's Baltic activities as part of a strategic plan to turn the region into a major transit hub between East and West.

"We want to become the biggest player in the logistics and transportation industry in the region," DHL Express Nordic chief Bill A. Blomquist said during his visit to Tallinn last week. Estonia, he explained, is ideally located to become the main route and port entry to Russian, Belorusian and Ukrainian markets.

"The growth can come after the Baltic market is substantially bigger," he said. "We want to acquire businesses and create alliances and partnerships to grow faster."

When it comes to the Baltics as a growth market, Blomquist is bullish. "The industry's potential is unlimited. The total population of the three Baltic states is close to the number of Swedish residents, so why shouldn't the Baltic markets at the end of the day have an opportunity to act as the Swedish market?" he asked. "We are ready to invest money, time and manpower."

Though the exact amount of financial investment is being kept secret, DHL Express belongs to Deutsche Post World Net, and therefore has deep pockets.

DHL's press office reported in March that Deutsche Post World Net finished 2004 with a 7.9 percent increase in sales to 43.1 billion euros, while EBITA was 12.5 percent higher year-on-year, reaching 3.3 billion euros.

This kind of weight will trickle down to the Baltic region, Blomquist suggested. "DHL provides the broadest product range in the industry, plus we have the broadest local network on the global level. And DHL service quality is unquestionable," he said.

At the moment, there are nine DHL offices with 366 employers in the Baltic states, 129 of whom work in Estonia. Worldwide, the total number of employees is around 160,000.

According to DHL's 2003 regional report, 51 percent of company express and freight sales were made in Estonia, 28 percent in Latvia and 21 in Lithuania.

In 2004, the biggest players on the courier service market were DHL, followed by UPS and Bizpak. Compared to 2003, market leader DHL's share decreased 3 percent, while Bizpak's grew to 11 percent.