Double-digit growth for German parcel market in 2020, says regulator

Parcel volumes in Germany increased by about 17% to 3.6 billion shipments last year as the coronavirus pandemic boosted online trade and thus the parcels industry, according to new estimates from the country’s postal regulator, the Bundesnetzagentur (Federal Network Agency).

Parcel revenues are expected to have increased even faster by about 19% to €14.4 billion in 2020, the agency said in its latest market review, which is based on input from CEP operators. This would indicate higher average prices last year.

The domestic parcel market is estimated to have grown to 3.2 billion shipments and revenues of about €11.4 billion last year while there were about 380 million international parcels, generating revenues of about €3.1 billion.

E-commerce drives market growth

However, the rapid growth of online retailing already led to an “uninterrupted increase” in parcel volumes and a corresponding increase in sales even before the outbreak of the corona pandemic early last year, the Bundesnetzagentur commented.

According to the agency’s review, overall revenues in the German CEP (courier, express, parcel) market increased to €18.3 billion in 2019 from €17.7 billion in 2018 while volumes increased to 3.2 billion in 2019 from 3 billion the previous year.

Parcels and couriers grow but express falls

Growth was driven by the parcels sector, and by B2C parcels in particular. Volumes rose by 6.3% to nearly 3.1 billion in 2019, with domestic parcels totalling 2.7 billion and international parcels reaching 360 million. Revenues increased by 6.4% to €12.2 billion in 2019, including revenues of €9.4 billion from domestic parcels and €2.8 billion from international parcels.

Moreover, the courier market also grew in 2019, with revenues of €3.8 billion compared to €3.6 billion in 2018.

In contrast, the express market declined in 2019, according to the Bundesnetzagentur figures which showed a revenue fall to €2.3 billion in 2019 from €2.6 billion in 2018.

Pandemic accelerates letter decline

Meanwhile, the combination of continuing digitalization and the coronavirus pandemic accelerated the structural decline of the letters market last year.

For 2020, the Bundesnetzagentur estimates a 9% decline in letter volumes and a 2% fall in revenues. In 2019, letter volumes fell by 4.3% to 13.6 billion items while sales revenues dropped by 2.7% to €8.1 billion.

Jochen Homann, Bundesnetzagentur president, commented: "The continuous growth in parcel delivery as well as the decline in the mail sector further increased in 2020. The corona pandemic is a driver of this trend.”

The data is based on the annual postal market survey by the Bundesnetzagentur as part of which it interviews companies that are active in the postal sector about important key figures, such as sales, shipment volumes and employees. The agency stressed that whether and to what extent the forecast figures are confirmed can only be determined in the market survey in the following year, when the final financial statements of the companies are available.