Speaker 1: Bloomberg Audio Studios, podcasts, radio news, our companies, how our banks?
Speaker 1: How are consumers positioning ahead of what may be a
Speaker 1: pretty volatile second term for Donald Trump. We've got the
Speaker 1: perfect guest to talk about just that. Tobias, my DHL
Speaker 1: Group's CEO, is in London just to see us, I'm told,
Speaker 1: joins us around the table. Tobias, a pleasure to have
Speaker 1: you on the program. Walk us through kind of this
Speaker 1: positioning story around Donald Trump.
Speaker 2: What are you hearing?
Speaker 1: Are people worried? Are you seeing that show up in the.
Speaker 3: Likes of some of the flows, Well, definitely, I mean
Speaker 3: it's a big topic. I was in South America just
Speaker 3: two weeks ago for an entire week in Mexico.
Speaker 2: In Brazil, in Colombia as.
Speaker 3: Well, and especially the Mexican economy being so closely tied
Speaker 3: to the US, it's a big topic. What will happen
Speaker 3: also amongst our customers. We have supply chains, they are
Speaker 3: being closely integrated, a lot of parts coming from Mexico
Speaker 3: into plants in the US as well, so there's concern
Speaker 3: around that. But also on I think the Pacific, the
Speaker 3: China US trade being quite a strong element of that
Speaker 3: being b two c as well, So it's discussion about
Speaker 3: deminimus again the Transatlantic being more about industrials like Eldermorti.
Speaker 4: Is any evidence that people are front running the terraces?
Speaker 4: Are you seeing any stock built coming through? Maybe in
Speaker 4: the States.
Speaker 3: Hard to say, but there's a good volume in the
Speaker 3: last weeks. We see that in ocean freight, We see
Speaker 3: that in their freight. The year has been quite volatile.
Speaker 3: We had very strong exports out of China for many
Speaker 3: weeks on the ocean freight side especially, so strong growth there,
Speaker 3: but it has been volatile, so it's hard to call
Speaker 3: out whether there's really a strong element of that.
Speaker 1: Now you mentioned the South American aspect as well. Part
Speaker 1: of the Trump trade has been an expectation or a
Speaker 1: ramp up of this frond shoring dynamic. Is there evidence
Speaker 1: of that? I felt like in the first Trump administration
Speaker 1: that was kind of put on pause. Could you see
Speaker 1: that restart?
Speaker 2: Well? Definitely.
Speaker 3: As it relates to Mexico, I do think we see,
Speaker 3: for a variety of reasons that this diversification of the
Speaker 3: supply chain that has been taught about, which for Mexico
Speaker 3: and the US, means also some near shoring.
Speaker 2: I think for the rest of the world, this is
Speaker 2: quite different.
Speaker 3: We see more things shifting to Southeast Asia, but we've
Speaker 3: also seen customers putting production back into China, recognizing that
Speaker 3: this is the market where the supply chain is the deepest,
Speaker 3: the capacity is the largest, and many people still think
Speaker 3: that the next thing after China is China when it
Speaker 3: comes to manufacturing.
Speaker 5: I mean, you're based in Europe. When we're talking about
Speaker 5: trade under Donald Trump, how do you think that Europe's
Speaker 5: going to retaliate? I was going to say, negotiate. What
Speaker 5: are you planning for?
Speaker 2: Well, that's a good question.
Speaker 3: I think twenty twenty five is a year where the
Speaker 3: scenarios are unusually wide apart. You could definitely see a
Speaker 3: good scenario where indications out of the US continued investments
Speaker 3: along with IRA for instance, some tax relief elections in
Speaker 3: Europe that lead to stable goments that could influence confidence
Speaker 3: quite positively. But on the other hand, there is the
Speaker 3: scenario where support to Ukraine might not continue. That then
Speaker 3: weighing on confidence in Europe and tariffs coming into play.
Speaker 3: The European automotive industry is already in quite a weak position,
Speaker 3: so seeing tariffs on top of that would make people
Speaker 3: quite nervous. So the range of scenarios quite wide.
Speaker 5: There's a hard question I want to ask you. I mean,
Speaker 5: it's about the sad news of that plane crash, the
Speaker 5: DHL cargo plane crash near the Lithuanian capital. I know
Speaker 5: that a crew member died, three others were injured. I
Speaker 5: really wonder whether it's responsible to be using planes that
Speaker 5: first entered service in nineteen ninety three.
Speaker 3: That's that's older than critic Well, honestly, I don't think
Speaker 3: that is a problem. Our thoughts are with a family
Speaker 3: of the deceased, Parlod and the crew members that are
Speaker 3: still in hospital. But operating such aircraft safely is something
Speaker 3: that the industry has learned over many years. I'm an
Speaker 3: aviation engineer myself, and I find it close to a
Speaker 3: miracle the safety standards that.
Speaker 2: We have achieved in aviation.
Speaker 3: If you compare this, particularly what we see in terms
Speaker 3: of road transport, if you look at markets like India
Speaker 3: where we now have a six digit number of dead
Speaker 3: people on the road. So it is a very tragic event,
Speaker 3: and you're.
Speaker 5: Not worried about the safety of the fleet.
Speaker 3: No, I'm not worried about the safety of the fleet.
Speaker 3: The aviation industry has over many decades continued to lift
Speaker 3: the standards address new challenges of different kinds, taking the
Speaker 3: right conclusion also from technical failures that we've.
Speaker 2: Seen in the past.
Speaker 3: So I think this industry really has a very good
Speaker 3: track record as it relates to safety.
Speaker 4: You get the aircraft he wants out of Seattle. I
Speaker 4: think if you use an airline in a way, and
Speaker 4: when I talk to the airline bosses that I often
Speaker 4: talk to, they tell me they're not getting the airplanes
Speaker 4: they need out of Seattle.
Speaker 2: Is that a for you as well?
Speaker 3: So, yes, we still have some trouble seven aircraft freighters.
Speaker 3: We use new from the line aircraft, particularly on the
Speaker 3: intercontinental lanes. Also because of sustainability reasons, we want to
Speaker 3: have the most efficient asset to burn as little fuel
Speaker 3: as possible for the cargo that we transport.
Speaker 2: So that's very important to us.
Speaker 3: And we have initiated a new build program several years
Speaker 3: ago and we're still waiting for some aircraft. And we
Speaker 3: do see that the lack of deliveries is causing issues.
Speaker 4: So one of the issues that Bensmith and that France
Speaker 4: is flagging that his maintenance costs are significantly high. Are
Speaker 4: you having that same issue?
Speaker 3: Well, we all need to still fly all that aircraft
Speaker 3: also on intercontinental roots. That's not good for fuel burn
Speaker 3: and that's not good for maintenance as well.
Speaker 2: So in terms of the margin that is that is
Speaker 2: that a margin impact?
Speaker 3: I think for us it's Look, we operate a fleet
Speaker 3: of roughly three hundred units, so we're lacking a single
Speaker 3: digit number, so I can't.
Speaker 2: See that as a huge driver.
Speaker 3: But it's definitely more than an annoyance, more than an annoyance.
Speaker 1: Okay, well, purely that's the perfect segue almost to maybe
Speaker 1: something a little bit closer to home, and that is
Speaker 1: the German election coming up in February. Tobias, I'm not
Speaker 1: going to ask you what you think of the politics,
Speaker 1: but I am curious how it affects your business, and
Speaker 1: especially when things like corporate taxation are something that could
Speaker 1: very fundamentally change the bottom line of your company.
Speaker 3: Well, I mean we are now predominated in the national company.
Speaker 3: The great majority of our revenue is outside Germany.
Speaker 2: It still affects us.
Speaker 3: We are the universal service provide US that relates to
Speaker 3: the postal system, so we'll help with the ballots with
Speaker 3: the male elections.
Speaker 2: That's a big topic.
Speaker 3: For us, that we're well set up to do that
Speaker 3: in February when voters hit for the polls in Germany.
Speaker 3: I think what is very important for Europe is to
Speaker 3: see a stable government that we get out of this situation.
Speaker 3: That is not only now the case in Germany, but
Speaker 3: we see this in France with theis in the Netherlands,
Speaker 3: for instance, in Belgium, that we get into a setting
Speaker 3: again where we have solid governments with strong majorities or
Speaker 3: good majorities in their parliaments, and that we see politics
Speaker 3: moving forward.
Speaker 4: Are you suffering from just in terms of one of
Speaker 4: the fact is that the politics is interacting with at
Speaker 4: the moment is immigration and labor shortages? And is that
Speaker 4: something that you're experiencing right now? What kind of wage
Speaker 4: growth are you seeing? Are you seeing shortages of available labor?
Speaker 4: We're coming up to the holiday seasons. Is that a season?
Speaker 2: Is that an issue now?
Speaker 3: It has been much less of an issue this year
Speaker 3: and that's a good sign for us, but not a good.
Speaker 2: Sign for the economy.
Speaker 3: So I do think there is some weakening and we
Speaker 3: find it easier than in previous years to get labor
Speaker 3: for the peak season, be that in Germany, be that
Speaker 3: across Europe. I think structurally Germany has changed some things
Speaker 3: in terms of legislation to enable more regular immigration, immigration
Speaker 3: based on merits. So we think that this is a
Speaker 3: good thing, but it still needs to filter through. There's
Speaker 3: a lot of bureaucracy around that as well. Be a
Speaker 3: big topic in Germany and Europe anyway, there's.
Speaker 4: Too much bureaucracy in Germany. I'm sure you've got to say.
Speaker 4: The answer is yes, But how big a problem is
Speaker 4: it just to put you deal.
Speaker 2: With it at the co face every day?
Speaker 3: Yeah, and you know every piece of it is bearable,
Speaker 3: There's no doubt of it. If you take a single
Speaker 3: law and say why can a large company not do that,
Speaker 3: that's a good argument. But if you look at the
Speaker 3: breath that what we have built up over the last
Speaker 3: twenty years, you know, it's like a little stone put
Speaker 3: in your backpack every day and if you do that
Speaker 3: for a long time, it just gets very.
Speaker 2: Heavy, Tobi.
Speaker 1: So I'm going to put you on the spot twenty
Speaker 1: seconds if you can. DHL prides itself on being the
Speaker 1: first in a certain conflict zone and perhaps the last
Speaker 1: to leave. Are you positioning around the resolutions in the
Speaker 1: Middle East.
Speaker 3: Well, we operate in different countries around the world. We
Speaker 3: operate across also geopolitical borders.
Speaker 2: And will continue to do that.
Speaker 3: We need to work with local governments to enable that,
Speaker 3: so that's what we continue to do. We're going to
Speaker 3: be present in those markets. We stick by the policy
Speaker 3: that you mentioned. We want to be the first in
Speaker 3: last out to support our customers, to support these economies,
Speaker 3: to participate in the benefits of global trade.
Speaker 2: So that's what we've tried to do.
Speaker 1: All right, you heard it here DHL Group CEO Tobisemeyer
Speaker 1: joining us around the table. This is Bloomberg