XPO Logistics Inc. is continuing its strategy to consolidate third party logistics (3PL) services, saying it has now finalized its previously announced acquisition of the majority of Kuehne + Nagel’s contract logistics operations in the U.K. and Ireland.
Originally unveiled in March 2020, the deal will add both new clients and capabilities to Greenwich, Connecticut-based XPO’s extensive European business interests, according to statement by Malcolm Wilson, XPO’s CEO for Europe. The transaction expands XPO’s contract logistics network in the U.K. and Ireland to 248 locations and approximately 26,000 employees, performing services such as inbound and outbound distribution, reverse logistics management, and inventory management, primarily in the beverage, technology and e-commerce, and food service verticals.
Buying part of Kuehne + Nagel’s operation also adds to XPO’s initiative to break its sprawling, vertically integrated logistics interests into two speciality divisions, featuring a contract logistics and warehousing segment and a freight brokerage and trucking arm. That move is expected to be completed in the second half of 2021.
Across the logistics industry, companies are honing their skills at providing specialty services as they seek new ways to compete for customers in a world that has seen many traditional business norms upset by the pandemic, a Gartner analyst recently found.
For example, Kuehne + Nagel said its move has positioned it to better concentrate on its service offerings in the e-commerce and pharmaceutical sectors. Divesting this “major part” of its U.K. contract logistics portfolio to XPO follows the sale of other Kuehne + Nagel divisions in Argentina, its chilled fast moving consumer goods (FMCG) portfolio in France, and a number of real estate assets, Joerg Wolle, chairman of Kuehne + Nagel International AG, said in a release.
In another example, the British consulting firm GlobalData said today that parcel delivery giant UPS Inc. was following a similar trend by expanding its holiday logistics and vaccine delivery capabilities through increased hiring. UPS is hiring more than 100,000 seasonal employees for the holiday season along with job postings for the storage, transportation, and distribution of healthcare products including Covid-19 vaccines. The company is also strengthening its global healthcare-dedicated warehouses and distribution networks by expanding and building new facilities in Hungary, the U.K., and China. And in the U.S., the company is building additional cooler and freezer spaces for its new good manufacturing practice (GMP) facility in Louisville, GlobalData said.
