Subscribe to our free, weekly email newsletter!


Report indicates UPS will not make a move for TNT’s Express unit

By Jeff Berman, Group News Editor
December 10, 2010

Following the recent news that TNT, the fourth largest global parcel operator, plans to sell off its Express unit, media reports out of Europe indicate that UPS will not be a potential buyer of the unit.

UPS Chief Financial Officer Kurt Kuehn told a German newspaper, the Boersen-Zeitung, that the UPS does not intend to make any large acquisitions in the future. But he did say that the company may be more inclined to focus on small and medium-sized acquisitions in Europe rather than buying TNT’s Express unit.

Using DPWN DHL as an example, Kuehn explained that expanding too quickly into a region—as DPWN DHL did when DHL Express acquired Airborne Express in 2003 to establish a U.S. domestic presence—can be dangerous. DHL Express eventually pulled out of domestic operations in the U.S., due to severe financial losses and facing myriad challenges keeping up with the more established and larger UPS and FedEx.

“There are two strategies to climb the mountain; DHL selected the fast way, but when it reached the summit, it was exhausted and vulnerable,” Kuehn told Boersen-Zeitung.

A Reuters report stated that Kuehn said that any potential acquisition made by UPS would potentially be in Central Europe, Eastern Europe, or Turkey and would not necessarily be in the Express sector, and instead could be in the supply chain services arena.

A research note by David Ross, Stifel Nicolaus analyst, explained that UPS has denied interest in acquiring TNT’s Express business recently, adding that UPS already has a very strong European footprint—with roughly 50 percent of its International Package business Europe-related—and he noted that because of that fact it would make even less strategic sense for UPS to acquire TNT.

“I would say it is a mistake for either UPS or FedEx to buy [TNT],” said Jerry Hempstead, principal of Hempstead Consulting, in a recent interview. “It would just be the same mistake DHL made when they acquired Airborne. But UPS and FedEx are in this express and ground space already, and I can just see them not being able to resist the urge to get their brand on everything and forget why they are in business in the first place. And I can’t see the European Union letting DPWN-DHL buy TNT, because it then creates more of a monopoly in Europe.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

A recent Wall Street Journal report stated that third-party logistics and freight transportation services provider XPO Logistics shut down seven freight terminals that were part of the Con-way Inc. less-than-truckload (LTL) network, Con-way Freight. Con-way was acquired by XPO for $3 billion last year.

Many transportation/logistic organizations are applying a new wave of robotic process automation (RPA), a “no coding” approach that integrates and automates data-driven activities.

Logistics Management Group News Editor recently caught up with Frank Guenzerodt, president and CEO of Dachser USA, the American arm of global 3PL Dachser, about the company's ongoing expansion efforts into the U.S.

In an effort to help buyers of freight transportation and logistics services to better understand the required best practices in order to be a shipper of choice for their carrier partners, non asset-based third-party logistics (3PL) services provider Transplace said this week it has rolled out a Preferred Shipper Checklist.

For a new facility in Chicago, DHL Global Forwarding converted to electric lift trucks. The result? Better uptime and a cleaner environment.

Article Topics

News · UPS · DHL · TNT · DPWN DHL · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA