Speech Frank Appel
At the opening of the Leipzig/Halle air hub on May 26, 2008
Check against delivery.
Ladies and gentlemen of the media, good morning.
I would also like to extend a special warm welcome to the members of the international media who have joined us today from all over the globe!
After we decided to use the Leipzig/Halle airport as the base of our new European air hub, the first excavators went to work in 2005. One of central Germany's largest construction sites was created on 2 million square meters of fallow land. Up to 2,000 people worked here during peak periods.
In October 2006, a few of you had a chance to see how we were able to move forward at express speed. Back then, we and the German chancellor held a celebration to mark the halfway point of the project. Today, we have an even bigger reason to celebrate: the official opening of our DHL air hub!
Those of you who flew here have already had a bird's eye view of our new DHL air hub. I do not know what went through your minds. But I can assure you that I was really impressed by the size when I got a glimpse of our hub from the air this morning.
The area used by the air freight hub is bigger than the entire Principality of Monaco. When you are flying into Leipzig/Halle, the first thing that catches your eye is a huge, yellow-red cuboid. This is the heart of our air freight hub: the largest sorting facility in Germany. The building complex is the size of five soccer fields.
Today, we are in the building next door, the hangar - an immense facility in its own right. This gigantic garage can hold two A 380s - the world's largest plane.
Our DHL air hub is Europe's most up-to-date air freight hub. I am certain that the EUR300 million we have invested in the site is money well spent. And the reason is simple: We have invested in the future of our company - and in the future of the Leipzig/Halle region as well. Our goal is to grow faster and more strongly than our competitors over the long run. As the world's market leader, we strive to be pacesetters and to shape the future of our sector.
Logistics is the epitome of a sector of the future
As a result of globalization, product flows are rising around the world. In 2007, world trade climbed 7%, and the World Bank is forecasting growth of 7.4% for 2008. Experts expect the growth trend will continue for the next 25 years. Whether you are talking about silicon chips or car parts - production in manufacturing industries would quickly come to a halt without smoothly running logistics systems.
With about 2.5 million employees, logistics is already one of Germany's most important economic branches and has passed such sectors as the steel and automotive industries.
Germany can also thank the domestic logistics sector for the country's position as world export champion. In 2007, logistics was an economic engine with 8% growth. In comparison: Germany's gross domestic product grew just 2.6% during the same period.
With its global network, our subsidiary DHL is in the best position to exploit the sector's upswing. The demands being placed on logisticians today are: the highest speed, the highest reliability and the highest quality. In the process, demand for time-critical express services like international overnight shipment is rising. It was exactly for this reason that we decided to invest in the expansion of our express network.
During the subsequent search for an acceptable site, Leipzig/Halle soon stood out as the favorite. Within just a few weeks, it became clear that we had made the right decision. The close working relationship with government agencies was exceptional. The necessary building permits were issued practically at express speed. For this reason, I am particularly happy about being able to greet the premiers of Saxony and Saxony-Anhalt, Mr. Milbradt and Mr. Böhmer, during the opening ceremony that will follow this news conference. They constantly provided valuable support to the DHL project, and I intend to expressly thank them today for it.
There were also other powerful arguments for the Leipzig/Halle location. The most important of them was its strategically good geographic position in the heart of the new Europe. The growth markets of eastern and central Europe are practically right outside the front door. One look at the flight schedule for our air freight hub shows just how important these countries are for our customers and, thus, for DHL: No matter whether it is Moscow, Kiev or Sofia - we fly from Leipzig/Halle to 11 destinations in eastern Europe. Overall, we have 46 flight destinations on three continents.
For DHL, Leipzig/Halle is not only a bridgehead to the East, but also our gateway to the world. The new hub is one of three important centers in our global express network - in addition to Hong Kong and the United States. In just a few minutes, Scott Price will provide you with a more detailed look at the special role that these three air freight hubs play in our company.
The infrastructure of the region
This brings me to the second argument for Leipzig/Halle: the excellent transport infrastructure here. Even during the Middle Ages, Europe's most important trade arteries intersected in Leipzig. In the 15th century, the traditional trade-fair city even outranked Venice as a transshipping site for furs, silver, silk and gems.
Today, it is generally other goods that we receive here in Leipzig/Halle, sort and ship off in all directions. The transport connections of our hub are much more multi-faceted than they were back then. Nearly two decades after the fall of the Berlin Wall and the Iron Curtain, the region can finally profit completely from its position as a hub in the heart of Europe. Another reason for our decision to select Leipzig/Halle was the region's huge reservoir of workers.
And I have to be candid with you: The interest in our jobs exceeded our wildest expectations. We have received about 50,000 applications. By 2012, we will employ 3,500 men and women. Several thousand jobs will also be created elsewhere. When you look over the resumes of our employees at Leipzig/Halle, you notice one thing: Roughly 90 percent of them come from the region. And more than half were unemployed - many for years. I am really happy that we can help fight unemployment and offer new professional futures to residents of Leipzig, Halle and other communities in the area.
Logistics is an important job engine for this region. In addition to about 3,500 full-time jobs, 100 apprenticeships and 25 internships at DHL, 7,000 other jobs will be created elsewhere in the area. This amounts to about EUR70 million in purchasing power a year for the people of the region. Of course, these benefits, like everything in life, come at a price - and all of you saw the residents protesting airplane noise on your way here.
The logistics business and particularly its express segment, which is the focal point of this European hub, is a deadline-driven business. The customer wants a delivery to be made from one day to another - and if we as a modern logistics service provider cannot do this, then someone else will do it for us. Competitiveness clearly requires round-the-clock operations and, as a result, night-time flights.
We have never made a secret of the fact that approval of night-time flight operations was an important reason for the selection of Leipzig/Halle. Under a ruling by the German Administrative Court, express shipments may be flown without any restrictions - and we have informed the people of the region in a timely, honest and detailed manner from the very beginning that this was a critical operational requirement for our business. Without this approval, there would be neither a new hub in Leipzig/Halle nor the opportunities for the region that I have just described to you.
Naturally, we are well aware of the problems that night-time flight operations create for residents. For this reason, we are working hard to keep these negative effects to an absolute minimum. We fly only the things that are necessary - and use low-noise airplanes in a fleet that consists largely of B 757s and, in the future, B 777s.
These so-called whisper jets are among the most modern freight planes in their class. Compared with the previous model, they are 77% quieter and use 20% less fuel. The airport is providing additional support with a noise-protection concept. Thanks to its soundproof windows and ventilation systems, this program provides much more extensive support to residents than has been the case in Germany.
We have consciously designed this new location as a trimodal hub in which we can and want to use the roads and rails to complement airplane transports. Deutsche Bahn is currently building a cargo train station at the Leipzig/Halle Airport. We, like others, intend to take advantage of this station. In a first step, we will use freight trains between Leipzig/Halle and the Frankfurt/Main Airport as the year progresses.
Based on the motto of "being at home in the world, being committed to the region," we do not view logistics in Leipzig/Halle as a threat. Rather, we see it as a chance for this region and the people who want to live and work in this home.
Environmental protection and sustainability
We want to create a new beginning here not just by filling thousands of new jobs. We also intend to play a pacesetting role in terms of environmental protection. One issue that affects all of us is global climate change. The transport sector generates about 14% of global CO2 emissions. As the world's market leader in logistics, we realize that we have a responsibility for environmental protection. There is no denying that climate warming is coming. But we have the ability to control the degree of change.
For this reason, Deutsche Post World Net recently launched a global environmental protection program called GoGreen in which we voluntarily focus our actions on standards laid down by the Kyoto Protocol. Specifically, this means one thing: We intend to cut carbon-dioxide emissions for every mailed letter, every transported container and every used square meter of space by 30% by the year of 2020. Long before GoGreen was officially launched, Deutsche Post World Net placed a high priority on environmental protection - and this commitment is reflected in the construction of our new hub as well.
Our planning team wrestled with one question: Can a 23,000 square-meter hangar and a distribution center that is more than twice as big be operated in an environmentally friendly manner? I can report to you today: Yes, it can! Let me give you just a few examples that show just how it is done:
The hub's energy is provided largely by a gas-fired combined heat and power plant. The special feature is that the heat energy generated by electricity production is used directly at the facility. We use the energy generated by electricity production to heat the buildings in the winter and to cool the warehouses in the summer. In this way, 80% to 90% of the used energy is converted into electricity.
In conventional power plants, the total is only 30% to 40%. We also use solar power to produce electricity. One thousand square meters of solar cells have been installed on roofs of the buildings. As a result, we annually produce more than 100,000 kilowatt hours of electricity that we feed into the public grid. Thanks to our use of the combined heat and power plant and the photovoltaic system, we can save 3,000 tons of CO2 compared with conventional technologies every year.
Another example of the environmental protection that we practice is our use of rain water. Every year, we collect about 3,000 cubic meters of water in two cisterns. We use it instead of drinking water to do such things as wash our airplanes. DHL offers another special program for the region: We are the first company to offer a discounted job ticket. More than 500 employees are already taking advantage of this program. They use public transportation, instead of their own vehicles, to get to the hub. In doing so, they make their own, small contribution to environmental protection every day they go to work.
The resource-conserving concepts being tested here in Leipzig/Halle will provide valuable experience and will serve as examples for our locations around the world. Our goal is to be not only the sector's biggest company but also its leader in terms of environmental protection and sustainability.
Ladies and gentlemen, Leipzig/Halle is a really special place for the future of our company. At the same time, our DHL air hub is an important driving force for the region's continued economic growth. Right here, we have something that is called - in manager speak - a real "win-win situation." And I am certain that it will remain that way in the future. After all, we have some major plans for the years to come:
We will create more jobs. In a partnership with Lufthansa, DHL Express has set up a new air-freight company: AeroLogic. The first planes of this joint venture will take off in April 2009 - from Leipzig/Halle, too. The positive effect for the region will be about 1,000 additional jobs. We will give young people a future. We soon will open our DHL training facility. By 2012, we will be able to offer about 100 young people qualified apprenticeships, including as forwarding merchants, mechatronic technicians or logistics specialists.
We will exploit growth opportunities and are already thinking about how to expand the hub. The property has enough space for two other sorting facilities that are just as large as the first one. These are ideal conditions we need to meet the world's growing demand for express services and to create a world-class logistics center in Leipzig/Halle.
In conclusion, let me review once again the importance of Leipzig/Halle and, as a result, of this day for our Group. As our third central air freight hub, this location is not only the biggest construction project for our Group at the moment but also an extremely important milestone in the expansion of our international air transport network in the context of our broad growth strategy. We specifically chose Leipzig/Halle because we can profit both from its central geographic position in the heart of an expanded Europe and from its excellent infrastructure connections and its outstanding human resources.
In many ways, Leipzig/Halle represents the dawn of our company's future. I am thoroughly convinced of one thing: The decision to come here was exactly the right one. I cannot imagine a better location for our European hub. And I am really looking forward to our shared journey to the future - of DHL, the region and its people.