Ethiopian, DHL to invest EUR 10 mln on new JV Company
Eyes African, Chinese market
Ethiopian Airlines and DHL Global Forwarding on Thursday signed an agreement that enables them to form a joint venture company that provides global cargo and logistics services.
The new company named DHL-Ethiopian Airlines Logistics Services Ltd will be based in Addis Ababa Ethiopia and serves the entire African market. The Reporter has learnt that Ethiopian Airlines, the largest aviation group in Africa, and DHL, the leading global freight forwarding company, will invest more than EUR 10 million in the new JV company which is under establishment.
Ethiopian Airlines Group CEO Tewolde Gebremariam told The Reporter that both Ethiopian Airlines and DHL would make a huge investment in kind and services.
Amadou Diallo, DHL Global Forwarding CEO Middle East and Africa, told The Reporter that Ethiopian Airlines will have a 51 percent share while DHL would own 49 percent stake in the new joint venture company.
Tewolde said that DHL is the leading global forwarding company with long years of experience in the freight forwarding business and Ethiopian Airlines has a 72 years rich experience. “Ethiopian Cargo is the largest cargo operator in Africa. We have a good local knowledge of Africa. DHL has a rich global experience synergising our resources we will create the leading logistics service company in Africa.”
According to Tewolde, African economy is growing fast adding that the fast growth requires a modern and efficient logistics services. “IF we look at Ethiopia it is developing the manufacturing sector. The Ethiopian government is building 15 industrial zones of which three have been completed. But if we see the logistics service it is at its infant stage. We need to have an efficient cargo and logistics system to make our local industry globally competitive. Combining our resources together with DHL we will deliver an international standard logistics services to Africa,” Tewolde said.
Diallo said that DHL wants to build a champion in Africa. “If you go to Asia you have champions like China, Singapore and India. If you go to Europe you have Germany, France and the UK. When you come to Africa Ethiopia can be the champion of Africa. That is why we decided to come to Ethiopia and do freight business with Ethiopian Airlines,” he said.
Diallo said that the JV company would primarily serve Africa adding that it would cater high quality freight forwarding services for Chinese customers. “We will use Ethiopia as a gate way to Africa. We have many Chinese manufacturers who do business in Africa.”
Diallo disclosed that DHL did not come to Ethiopia to do only business. “We have a vision to train young Ethiopians and other Africans how to do the freight forwarding business.”
Pramod Bagalwadi, a DHL veteran with over two decades of experience in management roles within the logistics industry, has been appointed to lead the new organization. With 520,000 employees DHL delivers 78 parcels daily in more than 200 countries. It caters air, sea and road freight services.
With eight dedicated cargo aircraft, six B777-200F and two B757-200F and a daily up lift capacity of 8,672 tons, Ethiopian Cargo and Logistics Services is the largest cargo operator in Africa.
Ethiopian Cargo is now transporting 343,000 tons of cargo every year generating 10 billion birr revenue. According to Ethiopian 15-year growth road map dubbed Vision 2025, Ethiopian Cargo will have 19 dedicated freighter aircraft (11 B777, four B767-300 and four B737-800) which can transport 820,000 tons of cargo generating USD two billion of revenue flying to 57 destinations. It now serves 39 international cargo destinations.