UPS, FedEx Move Full Speed Ahead in Europe
Euro’s weakness, more cross-border shipments present opportunities for delivery firms
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FedEx’s expansion plans in Europe hinge on winning regulatory approval to buy TNT Express. A TNT Express courier pulls a pallet in Rome. Photo: ALESSIA PIERDOMENICO/BLOOMBERG NEWS
FedEx Corp. on Friday submitted required regulatory filings to the European Commission necessary to move ahead with its previously announced deal to acquire parcel firm TNT Express NV for nearly $5 billion. Meanwhile, United Parcel Service Inc. last month said it is building in the Netherlands a new temperature-controlled distribution center specifically designed for pharmaceuticals and medical products, the latest in a string of expansion projects expected to total nearly $2 billion over five years.
Last month, UPS also opened a $40 million expansion in Nuremberg, Germany, a package-sorting location for goods to and from Southeastern Europe. FedEx is building a new airport operation in Copenhagen slated to open this year. Not to be outdone, DHL Express—the dominant European player by market share—is doubling the size of its Leipzig, Germany, hub, spending €150 million ($167 million).
While the European economy flounders, the delivery companies are reaping certain benefits. In particular, a weak euro means their dollar investments go further. Additionally, businesses in the depressed southern European nations have been forced to look further afield for business, which often leads to more cross-border shipments.
“There’s a pizza on the table, and everyone is trying to have a piece of it,” said DHL Express Europe CEO John Pearson, adding his company also is investing in its home region.
