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TNT, the world's leading provider of express, logistics and mail services, set up its China headquarters in the city last weekend, reinforcing its commitment to the Chinese market.
Peter Bakker, chief executive officer of TNT, outlined the company's leadership vision, strategy and plans for the China market, saying that it plans to invest up to 200 million euros (US$242 million). China Daily reported Monday.
"China is identified as one of TNT's key growth areas. We have foreseen that the market will be a key driver for TNT's future global growth," Bakker said.
The investment will be used to establish TNT's nationwide distribution network in order to increase its market share.
The company reported global sales of 11.86 billion euros (US$14.4 billion) last year, with China taking up 250 million euros (US$303 million).
TNT insiders said the proportion is too small and needs to be enlarged, but they didn't say what percentage they are targeting.
Ken McCall, chief executive officer of TNT China, said the company had already set up a regional centre in Xi'an, Shaanxi Province, to distribute spare parts. The centre, as part of its national network, will serve the western part of the country.
More regional centres will be established in Tianjin Municipality, Shenyang of Liaoning Province, Wuhan of Hubei Province and Guangzhou of Guangdong Province. The network is expected to be completed before 2008, he said.
"We estimate that China is likely to be the world's second passenger car market by 2010, by which time its express market will be the sixth largest in the world," Bakker said.
As far as mail is concerned, an average Chinese person now receives about seven direct mail items per year, while in Europe this number is 85, he said.
"It is clear that the growth potential for our business in China is huge. We are determined to fully realize this potential," he said.
"TNT will grow as a company with China, and to help China grow with activities instrumental to the further economic development of China."
McCall said TNT will invest in its five pillars of business TNT-1 management structure, people, infrastructure, technology and relationships within the community.
With China's logistics market set for exponential growth, the company expect by 2010 that its staffing levels in China will increase 10-fold from 2,500 today, he said.
"Our challenge will be to ensure the highest standards of training and skills development," McCall said.
To this end, TNT is deploying 150 senior managers and professionals in China. Sixty of the positions are filled, and 50 per cent of those roles have been taken by local talent.
"Our vision for 2010 is to boost our coverage to 1,000 cities and increase the number of branches from 25 at year-end to more than 100 serviced by an integrated network," he said.
TNT will also need to employ a fleet of 2,500 vehicles and expand its present warehouse capacity of 325,000 square metres by a factor of 10, he said.
Source: China Daily
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