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TNT Express to cut 4000 jobs

Old 03-25-2013, 04:29 AM
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Default TNT Express to cut 4000 jobs

High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email [email protected] to buy additional rights. TNT Express unveils post-UPS strategy - FT.com

TNT Express said the sale of its Chinese business is expected “imminently” and reiterated its intent to sell its Brazilian arm in a strategy update two months after the collapse of a planned takeover by UPS.
The Dutch express delivery group fleshed out plans announced with its results last month to divest its global operations and refocus on its core European market. Investors had been awaiting the company’s strategy as a standalone company after UPS’s takeover bid was blocked by European competition authorities.

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TNT Express said it expected to cut 4,000 jobs over the next three years and reduce annual costs by €220m by 2015. It said it was exploring options for further reducing its fleet of aircraft, which it expanded in an attempt to compete globally with FedEx, DHL and UPS.

Bernard Bot, interim chief executive, declined to give any details of the prospective buyer of the company’s Chinese business but said “an announcement is expected imminently”. It was unclear how much the sale might fetch, as the Chinese arm recorded a net loss of €13m on €260m revenue in 2012.\

TNT Express’s Brazilian business is also unprofitable but Mr Bot said the first two months of 2013 showed a substantial reduction in losses.

Mr Bot will return to his previous position as chief financial officer when Tex Gunning takes over as chief executive in June.

In a statement, Mr Bot said TNT Express “faces difficult market conditions and strategic challenges” but cited the company’s “unrivalled European network”.

TNT Express and DHL vie for the largest share of the European delivery market, with the leading company varying depending on how the market is measured. But TNT Express’s truck fleet and road hub network is larger than DHL’s, allowing it to offer express delivery by road, including delivery of heavier freight than is possible by air.

“Our air network in Europe is [comparable to DHL’s] but then we have the combination with road, which nobody else can offer,” Mr Bot said.

The company said it targeted an operating margin in Europe, the Middle East and Africa of 8 per cent by 2015, up from 6.3 per cent last year, assuming a return to 2 per cent gross domestic product growth in Europe.

The 4,000 job cuts will involve attrition and a reduction in the numbers of outside consultants as well as terminations, Mr Bot said. The company expects to spend €150m on redundancy and other payments.

In a note, Maarten Bakker of ABN Amro said the new strategy “likely fails to inspire investors” as it mainly reiterated earlier statements.

Shares were up 0.2 per cent to €5.91 in morning trading on the Amsterdam exchange, against a 0.6 per cent rise in the AEX index.
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Old 03-25-2013, 07:01 AM
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Good thing the EU socialists showed UPS the door...power to the people...in the unemployment lines.
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Old 03-26-2013, 10:29 PM
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Blame it on the NURPS
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Old 04-07-2013, 05:21 PM
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Originally Posted by Sideshow Bob View Post
Good thing the EU socialists showed UPS the door...power to the people...in the unemployment lines.
UPS is still trying ...

UPS Appeal
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Old 04-08-2013, 04:42 AM
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Originally Posted by KnightFlyer View Post
UPS is still trying ...
This leads me to believe that the EU made an agreement to let the merger go thru if UPS "appeals" the ruling.

This allows the EU to save face and prevent further TNT job losses.

My understanding is that the EU wanted 1 more concession, and UPS said no, and the EU was astounded that UPS gave up.
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Old 04-08-2013, 06:39 AM
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Originally Posted by navigatro View Post
This leads me to believe that the EU made an agreement to let the merger go thru if UPS "appeals" the ruling.

This allows the EU to save face and prevent further TNT job losses.

My understanding is that the EU wanted 1 more concession, and UPS said no, and the EU was astounded that UPS gave up.
Interesting conspiracy theory. If the purchase price was reduced as a result it might make sense, but given the EU economy, they may have just become the girl at the dance with a five o'clock shadow at this point, and we should let them all choke on their protectionist, statist banality. UPS had likely already concessed their way out of a worthwhile deal already. Interesting thought though, I must say.
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