Deutsche Post DHL to restructure Express model

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Deutsche Post DHL plans of a wide-ranging reorganisation within the Express division to create a leaner and more streamlined business.

The current five geographical regions will be combined to form three, which will be complemented by a new governance model with a six member global management team.

The team will be looking to improve the loss-making domestic business and sharpen the focus on the group’s profitable international Express business and on further cost reductions.

The news comes as Deutsche Post DHL posts a 12.9 per cent drop in sales to 11.5 billion euros for the first quarter of 2009, while underlying EBIT declined by 42.1 per cent to 312 million euros.

The company puts the sales decrease down to the unprecedented plunge in demand across all regions and sectors, as well as reduced volumes and higher wages in the Mail Corporate Division.

Frank Appel, chief executive officer, said: “We have to act now to secure our profitability and jobs over the long term. There can’t be any sacred cows.

“While the latest data seems to indicate that we have reached a bottom in terms of shipping volumes, we are preparing to deal with a longer period of weak demand all across the world and therefore will relentlessly focus on reducing our cost base, particularly in Mail and Express, as well as securing our solid cash position.”

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