Interview with Samar Nath, CEO, DHL Logistics Private Limited

Company Description: DHL covers a gamut of end-to-end supply chain solutions, through its four business units namely, DHL Global Forwarding, DHL Supply Chain, DHL Express and Blue Dart.  All put together, DHL in India has in excess of 16,000 strong workforce spread across 36,000 locations with 6.45 million square feet warehousing space. Having established in India a long time ago, with the advantage of being an early entrant, India is one of the fastest growing markets for DHL.

What is DHL’s marketshare in India from the automotive related businesses, especially ancillaries, kits and parts logistics?

DHL is amongst the largest players in the global automotive market. DHL Global Forwarding commands a major market share in the Indian automotive and auto-ancillary segments.  The automotive market contributes a sizable share towards DHL Global Forwarding’s overall revenue.

What is the share of growth seen by DHL region wise?

DHL Global Forwarding has a significant share of the automotive market in India.  While we are well entrenched in the west, we are aggressively focused on further increasing our market share in other parts of the country, particularly in the south. Developing auto markets are under the spotlight as traditional centres of production and consumption are shifting to these developing markets heightened by a number of factors.  Coupled with environmental pressures, government interventions and fuel spikes, change is in the air. 

DHL Global Forwarding will continue to focus on pan India growth to expand its automotive base in the country.  In India, much of the growth is being driven by the country’s expansion as a small car hub, increased sourcing of auto components, expansion of the domestic dealer network, development of higher volume production plants and an increasingly global presence.

How does automotive as a vertical fare for DHL against other verticals like Life Sciences, IT etc.?

The innovative logistics solutions we provide support DHL’s strategic orientation to key global industry sectors, such as automotive, technology, life sciences/healthcare or energy. DHL pools sector-specific expertise across all business areas and has, for instance, established special Automotive Competence Centres for the automobile industry worldwide. In these centres, DHL employees cater exclusively to the logistics needs of car manufacturers and their suppliers.

What is the year-on-year growth for DHL in the auto segment in India?

As the Indian automotive sector develops, so too has the contribution of this vertical to our bottom line increased over the years and remains bullish for the future.  As an industry, automotive sector has always been advanced when it comes to logistics. New cost and competitive pressures and environmental issues have thrown up the need for more modular supply chain solutions created with global partners who can adopt local approaches and expertise. Nowhere is this need greater than in emerging markets challenged by the lack of infrastructure, expertise and processes.

Can you name a couple of auto brands you cater to globally out of India?

Globally, DHL is the leading logistics service provider for the automotive industry, serving almost all vehicle manufacturers and suppliers worldwide. In India, we cater to most of the leading MNC and principal local automotive brands.

Can you talk about the network DHL has across the country. Out of this, what will be the penetration level, down south?

DHL Global Forwarding has dedicated automotive teams that provide strategic consulting for a variety of customers – from international players seeking to expand their presence in the domestic market, to indigenous companies aiming to go global, servicing more than 50,000 customers across India. 

What is more, our strong customer offering in India covers the entire spectrum of end-to-end supply chain solutions, through our four business units, namely: DHL Global Forwarding, DHL Supply Chain, DHL Express and Blue Dart.  Collectively, DHL in India has over 16,000 employees spread across 36,000 locations with 6.45 million square feet warehousing space. Thus we are in a position to work closely with customers and ensure delivery of scalable and sustainable solutions, at any location in the country.

What are the expansion plans of DHL?

DHL will continue to invest in innovative and cost-effective solutions to cater to the needs of our customers. With offices across the entire country, manned by our qualified employees, the company is strategically poised to enhance servicing capabilities, make significant investments to further consolidate its leadership position and add considerable value to its service offering.

We recognise that the several opportunities and challenges in India are resulting in longer, more complex supply chains requiring increased control.  DHL emphasises the need to maximise on economies of scale, re-engineer manufacturing productivity and boost logistics efficiency for the growth of the automotive market.

What are the destinations DHL focuses on shipping auto parts globally?

DHL’s international network links more than 220 countries and territories worldwide which include the key global automotive markets, such as Europe, the US, Latin America and  Asia Pacific. Within India, DHL has dedicated automotive teams that provide strategic consulting for a variety of customers. Apart from the international players seeking to expand their presence in both the domestic market as well as companies aiming to go global, DHL services a large customer base in India.

Any other plans for 2014?

For global vehicle producers – and growing local brands – the challenges of meeting emerging market demand, dealing with local requirements and           increasing environmental imperatives will be just as complex as incorporating suppliers, assemblers and distributors from around the world, including emerging markets, into their value chain.  Combined, they create a tough challenge but those willing to take this up will enjoy sustained success and an unbeatable competitive advantage in these fast growing markets. Without doubt, the winners will be those who invest in sustainable supply chain management solutions.

Given the current economic condition across the globe, the most important aspect that customers seek before investing with a supply chain partner is their ability to adapt, collaborate, innovate and deliver value thus positively affecting their ROI on spends related to supply chain and logistics. Having worked with leading western and eastern automakers in every region and at every stage of the logistics process, DHL has both a macro and micro view of the issues they face in top emerging markets such as China and India.  With its local and global expertise and in-depth knowledge of both the logistics and automotive markets, DHL has been delivering significant savings to customers and will strive to continue with providing this advantage to them.