At the gates of London
You can move a great distance whilst staying in the same corporation, as Dutchman Ernst Schulze did in September 2019, moving from Ecuador to become CEO of DP World in the UK. He spoke to Christian Doepgen about developing ports, logistics parks and intermodal projects there.
Your way in DP World led you from the shores of Latin American to the white cliffs of Dover. What are the biggest differences you’ve encountered?
Well, there’s the weather for a start... No, seriously, what connects us across the 60 countries where DP World is active is a vision to lead future trade and to create growth. Our principles are the same everywhere, but of course we adapt them to national cultures, and enter into many joint ventures with local partners.
The UK market is considered particularly important by DP World; the GBP 2 billion we’ve invested in the United Kingdom over the past ten years bears witness to this, as do the further GBP 1 billion due in the ten years to come. We have around 1,000 employees here; in 2019 we handled 1.9 million teu in Southampton and 1.6 million boxes in the London Gateway. We expect to achieve a
comparable figure in 2020.
Your first year as CEO of DP World in the UK was heavily hit by Covid-19. How did the outbreak affect business?
We coped well and still are – even though we’re still in the pandemic. Early in 2020 we had our response plan in place. Protect people; follow government guidelines; remain creative. So many people depend on us; we transport goods worth more than GBP 43 billion annually, after all. We run a number of projects to make our activities more efficient, including one in the border inspection station in Southampton, for example.
External events continue to affect business. Is the cosy start to Brexit over? What do you expect in 2021?
85–90% of DP World’s business is conducted outside of the EU. We nevertheless prepared well, getting new employees on board rapidly, for example, making sure we had truck parking spaces in place, as well as BEEMS (border entry and exit movement service), our new digital unit for faster customs clearance processes. All types of information flow through BEEMS in real time; as much as through our CNS digital platform. Ever-more customers are signing up for these.
Congestion is a problem in the UK too. How have you solved capacity difficulties?
We’re operating very close to our capacity limits. After declines in the second and third quarters of 2020, cargo volumes soon picked up again. From August on we intensified our training efforts, recruited 40 workers, and added space in our storage yard to stack 8,000 additio- nal empty containers. This enabled us to remain productive and reliable.
Developing the London Gateway Logistics Park is a major issue. Who is due to settle there next, after DHL, Compagnie Fruitière and Britannia Bureau?
There’s been a surge in demand for our location outside greater London. Around 30% of the 186 ha of logistics space is now occupied. In 2020 we leased out around 335,000 m2. E-commerce has really taken off, as have perishables. Around 95% of citrus exports from South Africa come through our facilities. Our port-centric logistics services work well.
How do you expect ports to develop?
We want to increase capacities step by step. From 2021 onwards we’re set to invest approximately GBP 300 million in berths and quays. Dredging work in Southampton will additionally allow more mega-ships to call. We already proved what we’re capable of in June 2020, when the handled the largest ULCV so far, the HMM Algeciras with its around 24,000 teu on board.
Hinterland connections are a key trump. What percent of DP World’s throughput in the UK goes the intermodal way?
About 30% of our cargo is transported by rail, which means there are 300,000 less trucks on the road every year and correspondingly lower CO2 emissions too. We still have some capacities left on the railways; using them is question of efficiency, which we can improve in collaboration with our partners. This is where we can achieve great results together with intermodal operators.
Looking ahead, what are the prospects for your Thames Freeport bid?
There are great possibilities there! The bidding process for the operation of a new free port on the river Thames closed on 5 February. In partnership with Forth Ports, Ford and local parties, DP World has submitted an offer. We’ve received lots of support from local councils; they expect to create around 25,000 new jobs through this undertaking. We can offer our expertise, our facilities and 3 million m2 of space. This combined port and logistics cluster will promote both logistics services and a more ecological approach.
How is your digitalisation going?
We continuously implement new smart logistics solutions. One of the tracking tools we use is called ‘Where is my container’, which offers customers real-time locational data. We adapt and deploy our technological developments from Dubai in the local market. So you can see that DP World has a great story to tell in the United Kingdom.
