UPS-TNT combo tops DHL, dwarfs FedEx in Europe, but not in Asia
2012 04 02
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THE acquisition of TNT by United Parcel Service (UPS) will have the company surpass DHL in scale to become the biggest express delivery company in Europe, according to the International Express Parcels 2012 report.
But DHL will continue to dominate the higher yielding 'time definite international' segment of the industry globally, in Europe and in Asia Pacific according to the report.
The acquisition will leave FedEx trailing in a distant third place, although the UPS still dominant in the US, Atlanta-based FedEx is still stronger in Asia even with the combined forces of TNT.
The acquisition's most significant impact will be in Europe where competition regulators are bound to take an interest, notes the UK's Transport Intelligence. In several key country markets, UPS-TNT will become the single largest player, breaking through the significant 25 per cent market share, which alarms regulators.
Despite this, Transport Intelligence believes that following the acquisition, UPS will only have to make limited disposals, if any, to keep them happy because there is a good deal of market fragmentation.
The acquisition comes at a good time for UPS, according to Ti. "TNT became vulnerable to takeover as a result of the challenging market environment and internal operational and managerial difficulties. This has allowed UPS to buy at the bottom of this cycle. The express market will grow strongly in the coming years buoyed by economic growth, world trade and e-commerce. UPS now has an even better platform to exploit these trends," said Ti chief executive John Manners-Bell.
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