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DHL Express tightens its belt


The express delivery company has more cargo volume, but adjusts its costs. "I'm trying to reduce the workforce," acknowledges John Pearson, its manager

With 300 aircraft, 50 of them wide-body, the courier company DHL can boast of having a larger fleet than most passenger airlines.

Its ships serve some 500 airports around the world to ensure packages arrive on time.

This business, that of urgent shipments and with a predefined schedule, is the main task of DHL Express, which last year contributed 28.6% of the 94,436 million euros billed by the Deutsche Post DHL Group.

That is, about 27,000 million.

At the head of that division, with the 300 aircraft and some 120,000 employees in charge, has been the British John Pearson (London, 60 years old) since 2019.

In his four years as CEO, he has lived through the pandemic, the war in Ukraine,

the rupture of global supply chains or the trade tensions between the US and China.

But “none of it is too challenging if you have a great team,” she says.

The executive, who is part of the board of directors of the Bonn, Germany-based group, describes setbacks as an inseparable part of his business.

Looking back more than a decade, to the times of the Great Recession or the great ash cloud from the Icelandic volcano that paralyzed aviation across Europe, he recalls a lesson that has stuck with him.

“A former boss told me, 'John, we're a global company and every day there's going to be a crisis somewhere.'

And he was right.

From the devastating fires in Australia to the recent earthquake in Turkey, no catastrophe has spared a company with a presence in more than 220 territories.

“I recently heard about


, which is simply the present, one thing happening after another... The other day we saw [the fall of] Silicon Valley Bank and tomorrow it will be another bigger thing.

It's something we have to work with: we're a global company, we're the market leader, and therefore I think we're quite capable,” says Pearson.

But that is not an obstacle for the manager to end up recounting two especially delicate moments of his tenure.

“Operationally, the most challenging thing was the pandemic because it meant that we suddenly needed more or fewer planes, that we needed them in different places, that we had too much load or not enough load, we had layoffs, salary caps,” grant.

“They were things we had never done before in our lives.”

The other shock was the Russian invasion of the Ukraine and the wave of sanctions and company withdrawals.

“We lost nine planes overnight, at a time when you couldn't find new planes without paying a ridiculous amount of money.

It took us three months to get that capacity back,” he recalls.

John Pearson, CEO of DHL Express.Andreas Kühlken (Internal and external usage of D)

Pearson's Conversation with


takes place in Dubai, where the company invited a group of European media to visit its facilities and present a global connectivity study.

Days before, the annual results for 2022 have been made public, in which the Deutsche Post DHL Group obtained net profits of 5,359 million euros, after achieving a record operating profit of 8,436 million.

The operating profit contributed by the division headed by Pearson, however, fell from 4,220 million euros in 2021 to 4,025 million last year.

And by 2023, the matrix contemplates a global reduction in the result of its operations.

But in the glitzy United Arab Emirates city, where DHL is investing in new logistics plants, any hint of pessimism seems off-limits.

“We are starting to see cargo volumes grow steadily again,”

says the CEO.

"It's not like it's going to be like this forever, but it's what's happening now."

The group's accounts attest to four years of consecutive growth, with a substantial jump after the pandemic, but caution prevails in the message right now.

The CEO of DHL Express insists on cost containment, starting with labor costs.

Since 2019, his division has hired some 15,000 people and now Pearson has asked his collaborators to stop adding workers.

"Anyone who hires someone tomorrow is pulling me in the wrong direction," he says.

“I am trying to reduce the workforce: we do not hire more and for every 10 people who leave, we replace one or two.

It depends on the country, there are countries where we are growing at 10% and there you have to replace everyone”.

The manager exemplifies what he is looking for with two balloons.

As a result of the pandemic, he explains, "the balloon of costs grew slowly and that of income very quickly."

“Now we are in the opposite situation,” he laments, “we hired the people, we got the planes, but the revenue started to slow down and we need to balance the situation.”

The adjustment will be made "to the extent possible, maintaining the commitment not to undertake massive departures" and, for the moment, without affecting the salary part.

"Salaries are not going to grow at the same level as inflation, but you can give your workers an increase that you consider to be fair," says the CEO.

His workforce, he adds, has experienced "an average increase of 8% globally, which was a way of thanking all the work and recognizing that inflation is there."

electronic commerce

The plans for Spain, according to Pearson, go through "maintaining what is already being done."

The "big issues" in which the company has set priorities are "sustainability, globalization, rebuilding e-commerce [which skyrocketed in the pandemic and then taking a step back] and digitization."

DHL Express expects to invest 130 million in the coming years in Spanish territory, and the new facilities of the hub (operational center) in Barcelona will take 90 million.

The current 1,400 collection or contracting points will become 2,500 in 2024, according to those plans.

The improvement of facilities, in a business that changes every day and where every second you earn counts, is actually a global commitment.

“My priority this year is to be able to build the infrastructure we need,

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Source: elparis

All business articles on 2023-03-25

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