Deutsche Post buoyed by '3 years ecommerce growth in 3 months'

BONN (Reuters) - German logistics group Deutsche Post AG expects its business from ecommerce will grow by about 50% over the Christmas period and the expansion will continue in 2021, the head of the company’s express business told Reuters.

FILE PHOTO: An employee works at a distribution centre of German postal and logistics group Deutsche Post DHL in Rodgau near Frankfurt, Germany, December 19, 2019. Picture taken December 19, 2019. REUTERS/Ralph Orlowski

“There’s a saying “Three years of e-commerce growth in three months” - that has proven true for us,” John Pearson said in an interview, adding he expected 50% growth over Christmas. “We will have an exhausting time until December 23.”

Pearson said his Express business, which offers a door-to-door service for urgent documents and goods, will likely maintain the 16% volume growth it saw in the third quarter in the fourth.

“It is quite possible that we will reach a similar level in the fourth quarter during the peak season,” he said.

Deutsche Post DHL, one of the world’s biggest post and freight companies, confirmed last month it is aiming for 2020 operating profit of between 4.1 billion and 4.4 billion euros, but said achieving the upper end would depend on whether it can efficiently use its delivery networks as volumes soar.

Pearson declined to comment directly on that target, but noted: “We can use our capacities optimally ... I can say that the quality of demand and the volumes transported are good.”

The market for air freight remains tight and prices are high, partly due to the lack of passenger aircraft flying due to the pandemic, he said, although Deutsche Post is in a good position because it owns its own fleet.

Deutsche Post is actively involved in discussions with governments and drug companies about how best to distribute coronavirus vaccines.

“Some will be moved in bulk and some via Express. The project is big and there is much to handle,” Pearson said.

The company is upbeat for 2021, as ecommerce is set to keep booming: “I take a positive view of the business environment for the coming year,” Pearson said, adding he expects the company to improve its margin and operating profit.

Reporting by Matthias Inverardi; Writing by Emma Thomasson; Editing by Caroline Copley