DHL readies for the ‘Super Bowl’ of the logistics year

DHL is gearing up for the “Super Bowl” of its business year, the upcoming peak holiday season, anticipating similar demand to last year.

The global logistics giant talked about its preparations for the peak season 2024 in a media call with key executives from the company, who referred to it as the “Super Bowl” of the company’s business year several times in the call.

Kraig Foreman, president, eCommerce DHL Supply Chain North America, said that from “a volume standpoint, we're planning pretty much across the board the same as last year.”

Under similarly constrained economic conditions, he said that US and Canadian consumers “will continue to be very cost conscious as disposable income is still a challenge.”

The harder thing to predict, said Foreman, was when consumers would buy. “Are they going to take the sale as they initially see it, or they're going to wait to see if something better comes along?” he queried, adding that DHL was preparing “for either scenario.”

Seasonal workers

To help them cope with peak season demand, the North America supply chain unit planned to hire more than 5,000 seasonal workers, he said. In addition, it would be deploying 500 extra robots across its network, “which will get us to close to 2,500 robots in our operations, which is really helping us continue to streamline and to manage flexibility of volume in our operations in a really strong way,” said Foreman.

Meanwhile, a further 600 US seasonal staff would be taken on by DHL Express, said Andrew Williams, CEO of DHL Express in the Americas. Williams also anticipated a one to two percent year-on-year (YoY) increase in demand for his business unit for the peak season, with most of that coming from SMEs, which make up 80% of its customer base.

Middle East, Ukraine impacts

Meanwhile, DHL is anticipating similar peak season demand in Europe compared to North America. However, its European delivery operation, which includes 45,000 employees spread across 60 countries and features ten regional hubs outside of the group’s main hub in Leipzig, Germany, is facing specific challenges, most notable of which is the ongoing “geopolitical risk” posed by the nearby conflicts in Ukraine and the Middle East.  

Speaking on the eve of the first anniversary of the 7 October Hamas attacks that led to the current outbreak of violence in the Middle East, Mike Parra, CEO of DHL Express in Europe, said uncertainty about the conflict’s ongoing impact on commercial shipping in the Red Sea continued to pose a challenge ahead of the peak season.

Proactive approach to uncertainty

Parra said that while intra-Europe shipping, which makes up about 50% of DHL Express’ European business was healthy, “at the same time it can be a challenge, depending on what's going on.”

He said that the company was taking “a proactive approach, despite uncertainties in consumer demand,” in order to “ensure we meet our quality standards and provide the needed capacity for our customers.”

As an example, he cited the investment in three additional Boeing 777’s to add capacity to its air freight division.