La Poste highlights ‘green’ parcel deliveries as French mail volumes collapse
La Poste aims to partly compensate for a dramatic pandemic-driven collapse in mail volumes this year with strong parcels growth as it speeds up its ‘green deliveries’ strategy.
The French postal group’s mail revenues could drop by as much as €2 billion this year, CEO Philippe Wahl told TV station BFM Business this week. “The brutal fall in mail led to a loss of €1 billion revenues in the mail business in the first half-year and it won’t be far off double that for the year,” he admitted. Additional parcel revenues of about €300 million this year will only fill part of this hole.
But Wahl emphasised that the group has extended its parcels market leadership in France, where it holds two-thirds of the market through Colissimo, Chronopost and DPD. “That has been reinforced during the crisis,” he insisted. In particular, rivals Mondial Relay and Relais Colis were forced to close their parcel shop networks during the lockdown period.
Mail chief Philippe Dorge told French newspaper Le Figaro in a separate interview that mail volumes could slump by as much as 19% this year compared to a fall of just under 8% in 2019. In contrast, parcel volumes could grow by 25% this year compared to 7-8% before the pandemic.
In 2019, La Poste’s Services-Mail-Parcels division increased revenues by 5.8% to €12.4 billion but its operating profit fell by 17.4% to €410 million. Services & Mail revenue grew by 6.1% to €10.5 billion as small acquisitions outweighed lower mail revenues. Colissimo parcel revenues grew by 5.7% to €1,875 million, volumes grew by 8.7% to 362 million items and operating profits improved to €172 million.
€66m for green parcel deliveries in France
In his TV interview, the Group La Poste CEO also highlighted the strategy of expanding zero- and low-emission parcel deliveries to reduce the group’s CO2 footprint. “We have just made 19 agreements with the big cities to decarbonise logistics,” he declared. “I’m touring municipal authorities to see how we can decarbonise all the logistics.”
A key role in these sustainable logistics ambitions will be played by the newly announced DPDgroup ‘green deliveries’ strategy. The group’s international parcels business plans to invest €200 million over the next five years to provide sustainable deliveries in 225 cities across Europe, cutting CO2 emissions by 89% in those cities and aiming for an overall 30% reduction in CO2 emissions per parcel.
In France, DPDgroup will invest a total of €66 million to ensure ‘clean deliveries’ in 77 cities and large towns in five years’ time. It will set up a network of urban depots and use low-emission or zero-emission vehicles or other sustainable transport means for final-mile deliveries by Chronopost and DPD.
A total of 43 cities will be served with at least one alternative vehicle by the end of this year, followed by 20 more next year and a further 14 between 2022 and 2025. In Paris, Chronopost has already been making all of its deliveries with non-polluting vehicles since September 2019.
E-shoppers want free sustainable deliveries
This ‘smart urban delivery’ strategy was also the focus of a workshop held by DPDgroup marketing and communications director Jean-Claude Sonet and global accounts director Christophe Saillard at the DELIVER 2020 online conference yesterday.
“We recognise we are part of the problem but we are also part of the solution,” Sonet told conference participants. “We want to be very pragmatic and act where we can have an impact.”
According to DPDgroup’s most recent survey of European e-shoppers, 70% of online buyers expect environmental responsibility from companies. This is particularly true of the very influential trend-setting e-commerce ‘aficionados’ who account for about 30% of e-commerce parcels and even more so of the ‘eco-selective buyers’ who take environmental factors into account when making online purchases, he pointed out.
But Sonet explained that e-shoppers are generally not ready to pay extra for green deliveries. “Our aim is to provide sustainable delivery at no extra cost,” he said.
Consolidated deliveries and route sharing?
Asked about the potential for consolidated deliveries to reduce journeys and thus emissions, Sonet said there is “an emerging need” for such a service. In Paris, for example, the group’s subsidiary Mister Pasha already offers weekly deliveries of bundled shipments at specific times, he pointed out. “This is certainly a way to go in future,” he commented.
More challenging, however, in terms of reducing emissions are rural deliveries and linehaul transportation, according to Sonet. Asked about route sharing in rural areas, he described this idea as “very challenging” as it required ‘convergence’ between carriers, including in IT.
DPDgroup is looking into ways to reduce emissions on long-distance linehaul transportation but this too was “more challenging than last-mile”, he explained.
