DHL ramps up investment in Brazil’s logistics sector

On the same day that DHL announced that it will begin managing in-plant logistics for Jaguar Land Rover’s manufacturing plant in Itatiaia, Brazil, the integrator’s supply chain arm, DHL Supply Chain, also said it will acquire control of the Brazilian road carrier Polar Transportes, a transport service provider for the life sciences and healthcare industry.

Brazil’s ongoing economic downturn has created some bargains, but using airfreight as an indicator, the region is still in the doldrums and any investment is long-term. IATA’s February numbers showed Latin American airlines mired in a protracted contraction, with demand down by 4.9 percent (or around 1 percent adjusting for the leap year) in February 2017 year-over-year, and a decrease in capacity of 7.2 percent.

“Recovery in seasonally-adjusted volumes also stalled with demand 14 percent lower than at the peak in 2014. And freight volumes have now been in contractionary territory in 25 out of the last 27 months” the report said. IATA concluded that, “Latin America continues to be blighted by weak economic and political conditions.”

Nonetheless, DHL regards Brazil’s life sciences and healthcare industries to be valuable real estate. “Acquiring control of our longstanding service provider Polar Transportes is a great opportunity for us in offering an integrated end-to-end solution for the pharma industry in Brazil,” said says Javier Bilbao, CEO DHL Supply Chain Latin America.

Mauricio Barros, president of DHL Supply Chain Brazil added that, “The temperature-controlled transport segment is one of the key elements in this industry.”

On the supply chain side, Brazilian automotive manufacturers also face an uphill battle, but DHL’s engagement enhances its footprint in an industry that at one time was regarded with the same enthusiasm as Mexico’s pre-Trump automotive sector.

“In these challenging times, the automotive industry has proved that it can reinvent itself by identifying new market approaches,” said DHL Supply Chain’s director of business development for Brazil, Miquele Lioi. “In this case, sound logistics planning and a safe and efficient execution are critical to achieving business success.”

Those interested in learning more about airfreight in 2017, should join us at Cargo Facts Asia in Shanghai, 25 – 26 April.  To register, or for more information, go to CargoFactsAsia.com