Shanghai Named New DHL Hub

SHANGHAI: DHL, a world leading express shipping and logistics company, yesterday announced it will spend $175 million to build its North Asia express transferring hub at Shanghai Pudong International Airport.

The announcement means the airport will be the first in the world with two international express transferring hubs. United Parcel Service Inc (UPS) is also building its international air hub at Pudong. The DHL North Asia hub, scheduled to be completed in the second half of 2010, will serve China and the vibrant North Asia region, which will contribute 30 percent of global express volume by 2015, the German courier said.

"It will play a catalytic role to boost DHL's growth in Asia Pacific and give us an even greater competitive edge in managing the huge and complex global trade that is being routed to this region," Dan McHugh, DHL Asia Pacific's CEO, said.

Shanghai beat 133 airports after two years of rigorous analysis DHL undertook before choosing its North Asia hub. The company said volume growth rate and flight connections were two major criteria. Shanghai was a promising option because of booming commercial activities in the Yangtze River Delta region, Stephen Charles Fenwick, senior vice-president of DHL Express Asia Pacific, said.

The Yangtze River Delta, one of China's major economic growth engines, contributed 41 percent of the country's total trade volume last year.

DHL's decision came as the Shanghai government tries to build Pudong International Airport into an international air cargo hub. The airport, which currently handles 63 percent of China's international cargo, is busy expanding its capacity and will be able to handle 6 million tons of cargo by 2015, Wu Nianzu, the Shanghai Airport Authority's chairman and president, said.

The DHL North Asia hub will be located near the airport's third runway, due to be completed by the end of the year, and will cover a total area of 88,000 sq m. DHL's US rival FedEx is also building a regional hub in Guangzhou next year. FedEx was previously based mainly in the Philippines.