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DHL Faces Economic Challenges Amidst Declining Mail Volume
2024-11-05 09:00:09
Business
Economy

DHL Faces Economic Challenges Amidst Declining Mail Volume

Image used under license from Shutterstock.com

DHL has recently revised its annual forecast downward due to persistent economic challenges. Despite a 6.2% sales increase in the third quarter, reaching 20.6 billion euros, operating profit stagnated, dropping from 4.7 billion to 4.0 billion euros over the first nine months.

A significant decline in mail volume, particularly an 18.9% drop in freight, coupled with rising material and personnel costs, has hindered profitability. The number of regular letters also fell by 2.9%.

In response to these challenges, DHL plans a postage increase at the year's end, pending approval from the Federal Network Agency. As the company prepares for the holiday season, hopes remain for a robust Christmas sales performance.

Related news on that topic:

Deutsche Post Pushes for Higher Postal Rates

Deutsche Post is advocating for a significant increase in postage rates, surpassing the 10.5% proposed by the Federal Network Agency. This demand arises from the insufficiency of the previous 4.6% hike in 2022 amid high inflation. CEO Tobias Meyer argues that the proposed increase fails to meet the legally required profit margin. In the third quarter of 2024, the company reported earnings of only 100 million euros in Germany's mail and parcel sector, falling short of the 330 million euros mandated by the Postal Act. As digital communication reduces letter volumes, Deutsche Post insists on raising the standard letter rate from 85 cents to potentially 95 cents. The current postage rate will expire by year-end, with a new rate set to take effect in 2025. The Federal Network Agency must approve this change, but Deutsche Post has threatened to pursue legal action if their demand is not met. Meyer highlights that Germany is unique in Europe for its slower postage rate increases compared to inflation, emphasizing the urgency of their request.

The press radar on this topic:

gmx
5. November 2024 um 07:23

Weak economy burdens post group DHL

Economy
DHL, the post group, had to lower its annual forecast. In the 3rd quarter, sales increased by 6.2% to 20.6 billion euros, but operating profit remained the same. In the first 9 months, it fell from 4.7 billion to 4.0 billion euros. Reasons are a weaker freight business, a 18.9% decline in mail volume and rising material/personnel costs that could not offset the increase in parcel volumes. The number of regular letters also fell by 2.9%. At the turn of the year, the post office plans a postage..
tz
5. November 2024 um 07:22

Weak Economy Poses Challenges for Postal Group DHL

Economy
DHL, formerly known as Deutsche Post, is now only responsible for the national mail business. However, this core business is struggling in the digital age; demand is declining. The Bonn-based logistics company recorded an 18.9% decrease in advertising mail in the third quarter, along with an increase in parcel volume, which could not offset the rising costs.
n-tv.de
5. November 2024 um 07:24

Operationally stable: DHL earns less and hopes for Christmas business - n-tv.de

Economy
DHL earns less, lowers medium-term targets and hopes for Christmas business. Revenue increases, but profit declines. Problems in the letter and parcel business as well as in the air freight forwarding division.
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