Frankfurt, March 6 Germany's logistics giant DHL Group announced on Thursday that it will cut 8,000 jobs at Post and Parcel Germany, a division dealing with post and parcels in Germany, as part of a broader cost-cutting initiative aimed at saving up to 1 billion euros (1.08 billion US dollars) in 2025.
The layoffs are part of the company's 'Fit for Growth' programme, which seeks to streamline operations in response to declining mail volumes and ongoing financial pressures. Digitalization has significantly reduced the demand for postal services in Germany, putting pressure on Post and Parcel Germany's business model, said the company.
DHL reported that Post & Parcel Germany's revenue grew by 2.7 per cent to 17.35 billion euros in 2024, but its earnings before interest and taxes (EBIT) fell 5.6 per cent to 821 million euros. The company said it would implement job reductions in a socially responsible manner in 2025.
Despite the challenging economic environment, DHL Group's overall revenue rose by 3.0 per cent to 84.19 billion euros in 2024. However, EBIT declined by 7.2 per cent to 5.89 billion euros, though the drop was smaller than analysts had predicted. The group's free cash flow exceeded expectations, reaching 3 billion euros.
DHL ended the year with a strong fourth quarter, posting 6.4 per cent sales growth to 22.7 billion euros, while EBIT jumped 12.9 per cent to 1.9 billion euros, Xinhua news agency reported.
Looking ahead, DHL CEO Tobias Meyer acknowledged ongoing global uncertainty but reaffirmed the company's commitment to growth despite market volatility. "We expect the global political and economic situation to remain volatile in 2025. However, we want to continue growing in this environment and are focusing on the measures we can control," Meyer stated.
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