Wednesday, May 21, 2008

Thai Air forwarder aims to outpace industry

NAREERAT WIRIYAPONG

CEVA Logistics (Thailand) aims to increase its turnover by 15-20% this year, outpacing the industry's expected growth of 10%, according to managing director, Winfried Kiesbueye.

CEVA, Thailand's top airfreight forwarder in terms of sales, was formed from a global merger of TNT Logistics and Eagle Global Logistics a year ago. The merged unit posted 26% growth in local airfreight turnover to 2.88 billion baht in 2007.

The achievement helped lift the company's ranking by the International Air Transport Association (IATA) from fourth to first place.

''The logistics industry normally grows at double the GDP growth rate, which in Thailand this year is estimated at 5%. We want to grow at higher than the industry's average by projecting annual revenue growth of 16% starting this year,'' Mr Kiesbueye said.

The projection was in line with CEVA's target to increase its global revenue to 10 billion by 2010, he added.

''We have seen very organic growth in Thailand. The country is one of CEVA's pillars of growth in the region,'' Mr Kiesbueye said.

The Thailand unit, positioned as a hub for Indochina, also serves clients in the Greater Mekong Subregion (GMS) including Vietnam, Laos, Cambodia and Burma.

Thailand at present contributes 12- 13% of CEVA's total revenue generated from the Asia-Pacific region which totalled 1.2 billion, behind Australia and China.

CEVA has invested 250 million baht this year to expand operations in Thailand, including the new high-tech finished goods hub in Ayutthaya and more 100 vehicles and trailers added to serve rising consumer needs, according to Roy Tan, country manager of CEVA Freight (Thailand).

The Thai unit now employs 2,900 people with more than 500 vehicles and trailers, 36 warehouses and shipping yards totalling 695,000 square metres, Mr Tan said.

Automotive-related clients, such as Isuzu, BMW, Goodyear and Delphi, generate 32% of CEVA's total revenue while the high-tech industry, as well as retail and consumer sectors were also strong, accounting for 22% and 15% of turnover respectively, he said.

Mr Kiesbueye said that in order to compete with Singapore and China to become an airfreight hub in the region, Thailand should invest more in infrastructure and create long-term consistent supporting policies for the sector.

As well, investing in industry professionals should be the focus of the government to support growth and bring down logistics costs.

''Thailand's logistics cost is about 18% of the GDP. That's too high,'' he said.

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