DHL eCommerce Solutions announced plans to invest 560 million pounds ($575 million) across its U.K. e-commerce operation, DHL Parcel U.K.
The investment comes following a 40 percent volume uplift since the start of 2020 and soaring demand for its e-commerce and B2B services, the company said Tuesday. The expansion project is designed to deliver the necessary infrastructure to facilitate growth, as well as put the business at the forefront of sustainable and digital logistics.
“The Covid pandemic has not only driven digitalization, but also significantly changed consumer behavior, rapidly accelerating the growth of e-commerce and shifting shopping habits,” said Pablo Ciano, executive vice president of corporate development at DHL Group and designated CEO of DHL eCommerce Solutions. “We believe this shift to online shopping will remain intact and, as e-commerce is one of the important pillars in our ‘Group Strategy 2025,’ we’ll continue to invest in the sector. This investment in the U.K. is a key part of that, supporting the expansion and modernization of our European network. I’m really looking forward to supporting the business on its growth path in my new role as CEO DHL eCommerce Solutions starting Aug. 1.”
Nearly half of the investment will be in a square new 25,000-square-meter hub in SEGRO Park Coventry Gateway, located south of Coventry Airport. The new facility will have the capacity to handle more than 500,000 items per day and is expected to create over 600 new jobs, including roles in the warehouse and as drivers, on top of administration and management positions.
The new hub will feature secure bonded storage and customs capabilities to support international e-commerce, a 48-door cross dock facility and state-of-the-art mechanization, allowing automatic sortation of mixed sized and weight items through high-speed sortation equipment. The building has been designed to achieve BREEAM ‘Excellent’ status to minimize its environmental impact through design features such as 7,000 square meters of solar panels, LED lighting and landscaping to protect the natural biodiversity of the area.
As well as incorporating EV charging points for cars, the site will also be equipped with LGV electric charging points throughout and sustainable fuel capabilities to pre-empt technology developments in larger vehicles over the coming years.
An initial 75 million pounds ($90 million) will be invested in upgrading the company’s fleet with a major focus on alternative fuel vehicles. The fleet investment includes six fully electric 18-ton trucks, 30 liquefied natural gas (bio-LNG) trucks and 18 electric tugs. This rollout will be followed by further sustainable fleet investments.
The investment in sustainable infrastructure and vehicles supports DHL Group’s sustainability strategy, which is in line with the Paris Agreement through the Science-Based Targets initiative (SBTi). In total, DHL Group will spend 7 billion pounds ($8.36 billion) in sustainable fuel and clean technologies by 2030.
In addition, DHL eCommerce Solutions will also invest about 220 million pounds ($263 million) to create 10 new collection and delivery depots across the U.K. and 20 more existing sites will be expanded. The new and expanded depots will create an additional 3,500 jobs across the country. The locations of the new sites have been strategically chosen to reduce the distance required to serve customers, enabling further deployment of electric vans and improving speed of service.
“This investment is a real demonstration of the excellent work our people and partners have delivered over the past two years to get us to the level of growth where major expansion is required to meet customer demand,” Peter Fuller, CEO of DHL Parcel U.K., added. “E-commerce is going to continue to shape the world around us. This investment, along with the strength of the DHL brand and our leading approach to digitalization and sustainability, will put us in a strong position to take advantage of market growth.”