Green Giant

While DHL is capable of improving load factors and staff training, which entail little extra investment, there are certain environmentally-friendly procedures it cannot pursue without customer participation.

These include transporting goods via shipping as opposed to air freight - a faster but more polluting means of transportation.

DHL has to a degree made a compromise in this respect by making plans to invest into sea-air. This would involve taking ocean freight out of Asia into Dubai, where it would put the cargo on a plane to Africa or Europe.

As this entails a bit more leave-time, customers would have to accept the additional length of four or five more days against a true air freight service, but they would receive cheaper rates, Ude says.

In addition to air freight, DHL also plans to build a Middle East road network with Oman and Dubai as the key hubs, so that there is an ocean road providing a cheap road distribution capability.

It will also connect the Middle East with Europe on the road, with a very close trucking link. Though the means of transportation can differ in its level of environmental impact, Ude is keen to point out transportation in itself is not always an un-environmental option.

Sometimes, he argues, it is better environmentally for companies to import certain items than to produce them themselves. This is particularly true in such regions as the Middle East, where the cost of production for many goods is especially high.

"Producing certain things here can be very very expensive," Ude claims. "There are some areas in the Middle East where they produce cows for fresh milk, whereas of course in this environment where you have to water them and grow grass in the desert, that entails a lot of energy consumption. It may be less efficient than an effective transport out of Europe, where they may grow naturally with normal grass."

Typically, a kilo of airfreight, depending upon which air lane you go on, costs around a dollar per kilo, and the value of a kilo can be tens of thousands. The average value of an air freight shipment transported by DHL would be around US$100 per kilo.

The most expensive goods that DHL transports are items like pharmaceuticals, such as cancer medication, which are often valued up to US$20,000 for a small box.

Occasionally, DHL also transports more unusual cargo, which can be incredibly valuable. "We recently transported three tigers from the US of a very rare subspecies to Asia," says Ude. "That was in a way very valuable as it was not a standard good."

One reason perishables such as food can be transported so quickly and cheaply is because they are often flown as backloads on return flights from planned destinations.

Whilst this is fuel efficient in that the flights are at least full, this often means that the true cost of pollution is not reflected in the cost of the items.

"In the UK, in the supermarket shelves there is enormous choice, which is a good thing, so people can buy a lot of stuff that they would not have known the name of 15 years ago," argues Ude. "On the other hand is the pollution reflected in the price? Sometimes you have your doubts."

The Middle East may become increasingly aware of the costs of transport over the next few years as the area, in addition to having a growing population, is also strategically placed to become a vital transport link.

With the global freight market set to reach US$1.4trillion by 2020, Ude argues the region will only see increasing levels of traffic over the next decade, quickly evolving into a global hub.

"This is an area where the population is really growing massively, so you will have greater demand for consumer goods and it will become a very large hub for transport into Africa, into Europe and into Asia."

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