Logistics firms: Boxed in
The return of borders poses a challenge to the soaring parcel-delivery business.
During the day, Leipzig’s airport is quiet.
It is at night that the airfield comes to life.
Next to the runway a yellow warehouse serves as the global sorting hub for DHL, a delivery firm owned by Deutsche Post of Germany.
A huge extension, which opened in October, means it can sort 150,000 parcels each hour, says Ken Allen, DHL’s CEO.
It was built as business soared.
But the express-delivery industry faces a new challenge: the return of trade barriers due to the protectionist bent of Donald Trump and because of Brexit.
The slower-moving shipping and air-cargo business has long been in the doldrums as a result of slow overall growth in trade in recent years.
Yet the rise of cross-border e-commerce has still meant booming business for express-delivery firms.
On January 31st UPS revealed record revenues for the fourth quarter of 2016; FedEx and DHL are expected to report similarly buoyant results next month.
Since 2008 half of the increase in express-delivery volumes has come from shoppers buying items online from another country.
Falling trade barriers have greatly helped them.
When DHL and FedEx were getting going, in the 1970s, there was little demand for international express deliveries.
Packages often got stuck in customs for weeks and were heavily taxed.
The expansion of free-trade areas, lower tariffs and the internet brought years of growth.
But after Mr Trump’s threats to raise tariffs on goods from China and Mexico, together with the indication last month from Theresa May, Britain’s prime minister, that the country will leave the EU’s customs union, there are widespread fears that the favourable tailwinds enjoyed by the industry for decades are gone.
“It’s all a real nightmare,” groans David Jinks of ParcelHero, a British parcel broker which works with DHL, FedEx and UPS.
Start with Brexit.
More physical border checks between Britain and Europe would do little direct damage.
Most packages arriving in Britain have already been checked for drugs and dangerous items.
Goods from outside the EU go through customs 95% of the time without any inspection or delay.
Instead, post-Brexit costs will probably come from long wrangles over which of 19,000 customs codes should be applied to a consignment.
As an example of what could happen, Halloween costumes from China often get stuck at Britain’s border while customs officials work out whether they are toys or children’s clothes, which attract different duties.
Such complexity would force delivery firms to put up their prices to customers, Mr Jinks says.
Sending an item from Britain to Switzerland (outside the EU) costs 150% more than it does to Italy (inside the EU).
The most severe impact on business would come from higher tariffs, which would hurt demand for cross-border imports and deliveries in favour of local goods.
This is where Mr Trump’s threats come into focus.
A trade war would hit the massive volume of consignments that DHL’s, FedEx’s and UPS’s planes carry every day in and out of America.
For the moment, a customs exemption exists for packages worth under $800.
This means that higher tariffs on a Chinese watch imported in bulk into the United States, for instance, could be avoided by an American ordering direct from Alibaba, a Chinese retailer, for delivery direct to their home.
But if Mr Trump is serious about cutting imports, he could get rid of this exemption.
It was only last March that Barack Obama increased it to $800 from the previous $200.
If it were lowered or eliminated by executive order, logistics-industry people would really panic.
They are putting a brave face on things.
DHL’s Mr Allen has emphasised that “globalisation is here to stay”, whatever Mr Trump does.
UPS’s boss, David Abney, hopes the president is not really against trade agreements.
Even more telling are the actions of Fred Smith, FedEx’s founder and CEO.
Last week, he quietly gave up running the firm day-to-day to spend more time campaigning for free trade.
1.comes to life 恢复生机
例句:If you look at it long enough, this portrait comes to life!
2.gave up 放弃
例句:He gave up holidays and other time off.
3.get rid of 摆脱
例句:To get rid of poverty is to raise the educational level of its people.
4.for instance 例如
例句:There are jobs more dangerous than truck driving; for instance, training lions.