Which company(ies) in your industry are most global? What has been the key to their success in other countries?
In analyzing various package delivery companies, it is clear that UPS is the most global. UPS employs 400, 000 people within the U.S. and 75,000 internationally. Regionally, UPS covers more than 220 countries and territories including every address in North America and Europe. In addition, the UPS has facilities in Europe, Asia Pacific, the U.S., and Canada. In total, the company has 807 facilities along with 196 service centers in more than 120 countries.
Since its founding in 1907, UPS has had the enterprise strategy of “ Create Value, Transform, and Invest to Grow,” which it has been living up to in various ways. One of those ways is visible in the attempt to acquire European company TNT Express.
TNT Express is a European based, cargo and express delivery company. TNT Express employs nearly 81,00 people and operates on 26,00 vehicles, 48 aircrafts, and a global collection of 2,400 depots and hubs. Although a new company, TNT generated £7 billion in revenue and £66 million in profits. With TNT’s growing success, UPS stood by its founding strategy of “ Create Value, Transform, and Invest to Grow,” and is now optimistically pursuing TNT Express.
In the article UPS Packages a European Deal, author Tony Daltorio highlights the major aspects of this deal. First, if the acquisition were signed, sealed, and delivered, UPS would be the largest mail carrier in Europe, reaching a European audience larger than its already massive customer base. Furthermore, the acquisition would provide UPS the positive presence TNT has in China and Brazil, countries with combined populations hovering over 1.5 billion people, ultimately expanding UPS in Asia and Latin America.
Although not the most affordable move by UPS ($6.4 billion), it has been one of their best pursuits since the founding. The acquisition would move UPS far beyond its competitors and expand their presence, reaching untouched markets. It would affirm the company’s purpose of “ We enable global commerce.”
Article link: http://beta.fool.com/tdalmoe/2012/02/24/ups-packages-european-deal/2325/?source=eogyholnk0000001
Do you think this will make Fedex fade away if this deal were to go through?
ReplyDeleteThis prospect of possibly acquiring TNT makes UPS a solid investment for buyers of stock. However, do you think a move like this could be considered a move towards monopoly? If they acquire TNT, there next moves will only be to acquire smaller and smaller Firms.
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