DHL Express plans to make a multi-million dollar investment that will see its existing gateway in South Korea expand into the company’s largest gateway in Asia-Pacific.
The international express service provider signed October 15 a concession agreement with Incheon International Airport Corporation to implement its largest investment in South Korea to date—a EUR131 million (US$146 million) expansion plan for its gateway in South Korea.
When completed in the second quarter of 2022, the new expansion will be the largest DHL Express investment in South Korea, catering to rising demand in regional e-commerce trade, the company said in a statement.
John Pearson, CEO of DHL Express, said the new investment will help the company “to connect the world even more and to further improve transit time of global trade and on the trade lanes to Asia.”
Ken Lee, CEO of DHL Express Asia Pacific, said, “Our Incheon Gateway occupies a vital strategic position along key routes between South Korea and countries like Singapore, Taiwan, Hong Kong and China—all of which are amongst our top ten inbound and outbound markets by express delivery volume.”
Lee added that with online retail sales in Asia Pacific expected to reach $2.5 trillion by 2023, “our latest investments in the Incheon Gateway will align our infrastructure to what Asia’s e-commerce generation needs for now and tomorrow.”
The expansion of the gateway, located next to Incheon International Airport—currently the world’s fourth busiest cargo handler—brings DHL Express’ commitment for this strategic hub to about EUR161 million in total.
Since the gateway opened in 2008, DHL Express has seen a growth of over 45% in shipment volume, indicating the growing role the gateway plays in global and intra-regional trade.
The multi-year investment is expected to further support demand growth up to 2032. The expanded facility will have a gross floor area of 58,700 square meters from the current 20,000 square meters—an increase of almost 200%. It will also be equipped with the latest technology for faster, more secure and efficient delivery handling processes.
With South Korea having one of the world’s highest rates of online shopping, and seen to become the world’s third largest e-commerce market after China and the United States by 2023, “this gateway expansion will create the foundation for e-commerce businesses to expand both locally and across the Asia Pacific region,” said the statement.
This investment also covers technical upgrades including fully automated X-ray inspection machines, a 4-kilometer conveyor belt, automated sorters, magnetic speed controllers and full CCTV coverage. The new technology will increase the Incheon gateway’s total handling volume of parcels and documents by over 150%— equipping it to service demand from some of the region’s fastest-growing economies.
The facility will also incorporate a range of “green” features such as the use of solar power and energy-efficient lighting systems to achieve CO2 reduction of up to 1,500 tons per year.
Image courtesy of DHL
