What Happened to the Express Parcel Service Company DHL?

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A few years ago, a new courier in bright yellow trucks appeared in the United States. But then, almost as quickly as it appeared, it vanished. So where did DHL come from and what happened to the express parcel service?  DHL was started with a few friends carrying documents on flights between California and Hawaii before growing into an international shipping company. It was later bought by the German Postal Service, and today, despite its absence in the US, it is still a major contender internationally.

DHL was first launched in 1969 by three friends: Adrian Dalsey, Larry Hillblom, and Robert Lynn. While in law school in San Francisco, California, Hillblom worked as a document courier.  From this experience, he discovered a niche market in providing document delivery service for large shipping companies. In a time prior to fax machines or the internet, Hillblom discovered that shipping companies could save time and money if ship manifests and cargo documents arrive ahead of the cargo on the ship. This made it possible to process the documents ahead of time, and then ships could be unloaded as soon as they arrived. Thus, the company was launched, with him and a few friends flying shipping documents back and forth between California and Hawaii. In the 1970’s, DHL became the first international shipping company flying packages to Asia and Australia years ahead of FedEx and UPS.

Despite DHL’s international success, they were never able to really break into the domestic market. Even though they maintained profitable operations within the United States, DHL never gained enough of a market share to compete with UPS and FedEx. However, DHL’s international operations continued to grow and be successful. By 1980, DHL had expanded to all six of the populated continents and started offering express parcel service to accompany their document courier services. Due to their established international network, DHL was envied by other carriers, and in 2002, DHL was acquired by Deutsche Post.

Deutsche Post is the German postal company. In 1995, the German government converted the government postal system into a private company, although the government held all of its shares until 2001. Immediately after the conversion in 1995, Deutsche Post set its sites on the lucrative international market with acquisitions of a number of European courier and logistic companies. In 1998, Deutsche Post began acquiring shares of DHL, and after its own initial public offering in 2001, Deutsche Post had enough cash to become the majority owner of DHL, which was finalized in 2002.

In 2003, DHL decided to make a major play for the US domestic market with the purchase of Airborne Express, making DHL the third largest domestic courier. DHL launched its fleet of yellow trucks and planes in the United States, greatly expanding its express parcel service. In spite of an aggressive marketing campaign and modest gains in market share, DHL failed to overcome the domestic dominance of UPS and FedEx. With the onset of the recession in 2007, DHL’s US profits plummeted, and by 2008, the company announced its withdrawal from the United States domestic market.

DHL still ships packages to and from the United States; however, they partner with the other domestic couriers for the last leg of the delivery. On the other hand, in many parts of the world, UPS and FedEx rely on DHL for the last leg of the delivery, as their international networks give them access to sites across the globe. From small beginnings in the late 1960s, DHL has grown into an international corporation with a global reach. Today, DHL continues to do what it has always done best: international document and express parcel service.

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