DHL Supply Chain to invest €350M in SEA

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DHL Supply Chain to invest €350M in SEA
(From L to R) Andries Retief (CEO, DHL Supply Chain Southeast Asia), Oscar de Bok (CEO, DHL Supply Chain), Javier Bilbao (CEO, DHL Supply Chain Asia Pacific) at Penang Logistics Hub 4 in Malaysia. Photo from DHL Supply Chain.
  • DHL Supply Chain is investing €350 million for expansion in Southeast Asia from 2023 to 2028, its biggest investment yet in the region, according to CEO Oscar de Bok
  • Of the total, €131 million is allocated to Malaysia, €104 million to Singapore, €80 million to the Philippines, and €35 million to Indonesia
  • The expansion aims to increase the company’s warehouse capacity in Southeast Asia by 25%, or 400,000 square meters, and create 3,000 job opportunities by 2024
  • The company is also speeding up its electric vehicle purchases, with the fleet in Southeast Asia expected to reach 3,200 vehicles over the next five years

PENANG, MALAYSIA — Contract logistics giant DHL Supply Chain (DSC) is committing €350 million for expansion in Southeast Asia from 2023 to 2028, its biggest investment yet in the region, according to CEO Oscar de Bok.

Of this investment, €80 million will be allocated to establishing two new warehouses in the Philippines. Malaysia will be allocated €131 million; Singapore, €104 million; and Indonesia, €35 million.

DHL Supply Chain CEO Oscar de Bok during a media briefing on October 17 at the DHL Supply Chain Penang Logistics Hub 4 in Malaysia.

The expansion aims to increase DSC’s warehouse capacity in Southeast Asia by 25%, or 400,000 sqm, and create 3,000 job opportunities by 2024, de Bok said during a media briefing on October 17 in Penang, Malaysia.

In addition to increasing its warehouse footprint, DSC intends to speed up its electric vehicle (EV) purchases, with the fleet in Southeast Asia expected to reach 3,200 vehicles over the next five years.

The first of the Philippine investment is the 50,000-square meter Sta. Rosa Logistics Center in Calamba, Laguna, DSC’s biggest facility in the country, which will open in the first quarter of 2024.

READ: DHL Supply Chain invests P4.9B in Sta. Rosa Logistics Center

The warehouse will feature elements for sustainable operations such as solar panels and EV charging stations.

A second facility, 20,000 sqm, is planned for 2025.

In Malaysia, DSC is building four new facilities, two in Penang, and one each in the central and southern regions, totaling 113,000 sqm. Employing 450 professionals in 2024, the warehouses will incorporate automated pallet storage systems and robotics.

For construction in Singapore are two warehouses with 77,000 sqm in total space employing such technologies as digital twins and sensors.

The Singapore operations, which will provide 1,000 new jobs in 2024, are expected to deploy an all-EV fleet by 2025.

In Indonesia, the Maheswari Green Logistics facility in West Java will be expanded by 40,000 sqm. This will be DSC’s seventh shared facility in the country and will provide 500 jobs in 2024. The facility expects to have 11 EVs by 2025.

All DSC warehouses will operate as carbon-neutral facilities, aligning with DHL Group’s sustainability goals for climate-neutral logistics by 2030, DSC Southeast Asia CEO Andries Retief said in the media briefing.

The investment also covers transportation assets, employee training, and the introduction of advanced warehouse technology.

The investment in Southeast Asia is part of DSC’s broader strategy, which has already seen €1.35 billion in global investments in support of customer omni-sourcing strategies.

De Bok noted the trend of omni-sourcing among customers, signifying a departure from sole-source reliance for product supplies, and prompted by the complexity resulting from the explosion in e-commerce.

“There is an incredible opportunity for businesses in Southeast Asia to strengthen supply chain resiliency. Companies are looking at diversifying their supply chains. Southeast Asia, with its efficient work environment and effective trade agreements such as the China-ASEAN FTA (Association of Southeast Asian Nations Free Trade Agreement) stands to benefit the most,” de Bok said.

DSC’s investment positions it to support customers’ growth and omni-sourcing strategies in the long term, contributing to increased market share in the Southeast Asian region, according to de Bok. – Roumina Pablo