HK: DHL to Lift Handling Capacity 20% with New Facility
By Alman Loong, The Standard | Jan. 19, 2007
DHL has announced a US$35 million (HK$273 million) investment program in its Hong Kong facilities that will increase DHL Express ground handling capacity by about 20 percent.
DHL Express operates two ground handling facilities in Cheung Sha Wan and Tsuen Wan serving DHL's Central Asia hub at Hong Kong International Airport.
The new facility in Kowloon will be about 4,400 square meters and capable of handling up to 7,500 shipments a day. It is expected to be operational by the second quarter. The investment lifts DHL's total investment in Hong Kong to US$645 million, which includes the US$210 million Central Asia SuperHub at Hong Kong International Airport and a US$400 million investment in a joint venture with Cathay Pacific to form Air Hong Kong, which feeds cargo from around Asia Pacific into Hong Kong.
The SuperHub expansion is also expected to be completed by the second half of the year.
Already the largest of DHL's hubs in the region, the facility will be fully operational in 2008 with a capacity of 40 million air shipments per year. DHL Asia Pacific head Scott Price said DHL holds a 40 percent market share in China and is looking to further tap into a region whose growth is being spurred by China's expanding economy and an increase in exports and domestic consumption.
"North Asia and China are growing rapidly," Price said on January 18. "We expect to see a growth in shipments in Japan and South Korea in the future."
Price also said DHL was deciding between Shanghai and South Korea to set up a new North Asia hub to tap into the growing business north of the region, but did not say when a final decision would be made.
The company's sales in China have risen by an average 35 percent to 45 percent last year, according to Price, with the Asia Pacific market, including Hong Kong, recording strong double-digit growth during the same period.
Price said Hong Kong would continue to be DHL's main central hub in Asia. "Forty percent of China's exports come from the Pearl River Delta, and DHL Express channels 70 percent of its handled China exports through Hong Kong," he said.