|Vol. 16 No. 63||
Tuesday August 8, 2017
Dimerco Upward Beat Goes On
Last year Dimerco handled 219,000 tons of air cargo, up 8.4 percent year-over-year. Volumes were buoyed by expansion of the company’s North America and European operations, which saw year-on-year growth of 28.5 percent and 29.2 percent, respectively.
Joey Chou, Corporate Vice President, Business Development, told FlyingTypers that further growth has followed this year. “For 2017 Q1, the year-to-date sales revenue of Dimerco Express Group is around USD $125 million, a 6.9 percent un-audited increase compared to the same period last year,” he said. “By region, we saw 17.9 percent year-on-year growth in our China and Hong Kong operations and 32.5 percent for Europe.”
Dimerco’s global network now takes in over 140 business locations in 17 countries in Asia, Australia, North America, and Europe, along with more than 190 strategic partner agents covering the rest of the world.
Looking South As Business Adds Up
Chou said he was optimistic on air forwarding markets for the rest of 2017, not least because Vietnam, the Philippines, Indonesia, and India were becoming key markets for electronics and mobile phone production and/or demand. “Traffic growth has been fastest on international routes within Asia, as well as between Asia and Europe,” he added. “And the reason could be that GDP growth in the ASEAN region is forecast to be 6.4 percent in 2017.”
Protectionism Not Needed
As for the U.S., he said a possible shift toward protectionism represented a substantial risk, but a risk that had not yet become reality. “Asia is particularly vulnerable to a decline in global trade because the region has a high trade openness ratio, with significant participation in global supply chains,” he explained. “However, since the Asia Pacific region remains the engine of global growth and the economic conditions of major countries are stable, the future of United States’ trade policies and agreements with its critical trading partners, such as China and India, would be the key.”
Strong Market Base
Dimerco’s home market of Taiwan, with its raft of multinational
electronics companies, has also provided strong base cargo flows. “For
2017 Q1, the year-to-date growth rate of overall sales revenue of Dimerco
Express Group in Taiwan is around a 7.6 percent increase compared to the
same period last year, with the tonnage up around 22 percent,” he
An Ocean Of Opportunities
Dimerco, like many other global forwarders, has also benefitted from the
shortcomings of ocean freight this year. It has prompted modal shift,
which saw strong uplift demand out of Hong Kong, Shanghai, Beijing, Guangzhou,
London, Milan, Frankfurt, and Chicago. But Chou said shippers were also
now looking beyond ocean and air, not least via the company’s Cross-Border
Train Freight service, which connects China with Europe, Central Asia,
and Russia via train. Dimerco has offered the CBTF for almost seven years
now and Chou said clients could benefit from 16-day transit times—around
20 days faster than ocean freight—but with only 30 percent of the
cost of airfreight.
Immature Digital Forwarders
Chou was also strident when asked how online forwarding companies might disrupt the businesses of incumbents. He said most digital forwarders were “immature at this stage” and would have a limited impact on established players until they learned to fully meet the service requirements of shippers. He also claimed that at present new entrants could “only provide services for general cargo” and could not meet “the complicated requirements” of real world forwarding.
Disrupting The Disruptors
By contrast, he insisted providers such as Dimerco provided tailor-made
solutions and countered the threat from disruptors by investing in new
technologies that improved services.
eCall Unifies Data
To further improve service levels, Dimerco has also developed an “eCall Freight System,” a platform that unifies data streams and information flows with local logistics partners. “Furthermore, Dimerco will create a big data base to improve the safety of cargo freight and maximize the operation efficiency and the service quality,” added Chou.
Looking beyond 2017, he said innovation would be critical to the sustainable
development of Dimerco’s air freight business.
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