21 Conversations | DHL Boscai: Global Supply Chain, China Remains a Key Pivot

Ask AI · How can DHL become a beacon amid global supply chain storms?

Reporter Gao Jianghong, 21st Century Business Herald

Over the past year, the Red Sea crisis has continued to escalate, causing the Red Sea shipping lanes to be disrupted; more recently, tensions around the Strait of Hormuz have also been heating up. Once this global’s most important oil transportation route is disrupted, it will trigger cascading effects on global energy supply and logistics costs, leaving the global economy shrouded in enormous uncertainty.

This is the most severe test that global trade routes have faced in years. How should we respond to these “black swan” events?

“We want to become a beacon for our customers in the storm.” On March 24, DHL Global Forwarding CEO Oscar de Bok, in an interview with reporters from 21st Century Business Herald in Shanghai, used this metaphor to describe DHL’s role positioning amid the current upheaval in global trade. De Bok also told reporters that although talk of “supply chain relocation” has never stopped, the volume of goods flowing from China to other regions of the world is still growing. China’s core position in global supply chains has not only not been weakened, but is being continuously strengthened instead.

In the face of ongoing shocks brought by geopolitical conflicts, De Bok disclosed that DHL has set a goal of increasing by 50% by 2030. On the strategic chessboard of this German logistics giant, the China market is not only a large business growth driver, but is increasingly becoming a frontline area for digital innovation and optimization of global supply chains.

Speaking about the current complex geopolitical environment, De Bok candidly said that the Middle East situation has a far-reaching impact on global supply chains. “When the conflict began, Middle East airlines were forced to suspend flights, accounting for about 18% of total global air cargo capacity. The impact is enormous.” He recalled that the maritime side was also hit hard—large numbers of container ships were stuck, leading to “voyage disruption.” Containers were unloaded in other markets and other ports, and the subsequent handling became a thorny problem.

In response to such challenges, DHL’s strategy is divided into three levels: first, ensuring the safety of local employees; second, doing its best to keep customers’ supply chains running, including finding alternative routes and capacity; and last, continuously monitoring available ports to respond to the cascading reactions caused by tight capacity.

“We hope to become a beacon for our customers in the storm,” De Bok said. He revealed that DHL provides customers with situation updates almost every day, and the number of customers participating in such calls alone reaches as many as 2,000.

For Chinese companies that are carrying out global business, De Bok offered specific advice. “Since 2020, almost every six months, there have been unexpected events that have a major impact on the supply chain. This tells us that when building supply chains, you cannot just base them on the current situation and then expect everything to go smoothly.” He suggested that companies adopt a scenario-planning approach to ensure that each critical component has more than one alternative source. “When we sign ocean freight contracts with customers, we don’t just have one basic scenario plan—we also discuss contingency plans in advance—such as alternative destination ports, sea-air intermodal or sea-and-land intermodal solutions. That way, when an unexpected event occurs, we can take action very quickly.”

In De Bok’s view, the current global trade pattern is undergoing structural change. He observed that although cargo volumes on some traditional routes have decreased, new growth points are emerging. “In China–Latin America, China–Africa, China–Europe, and within Asia itself, you can see a lot of growth. Interestingly, the sum of all these growths is slightly greater than the amount of reduction in cargo flows between China and the United States.” This pattern of shifting gains and losses precisely proves the resilience and adaptability of global supply chains.

He believes that global trade is still growing, and the value of logistics companies lies in helping customers navigate an increasingly complex supply chain network. “If you look at the average transportation mileage for products to reach their markets, it actually is still increasing. Because many companies have to organize cargo flows and global supply chains in different ways, which increases complexity.”

Although the global trade landscape is turbulent, De Bok repeatedly emphasized in the interview that the unique position of the China market has not changed. “If you examine global supply chains, China plays a vital role,” he pointed out. “Although the flow of global freight is changing, the volume of goods flowing from China to other regions of the world is still increasing. Whether it’s China to the Americas, China to Asia, or China to Europe, these freight flows are showing growth trends—this is a trend we’ve been observing for a long time.” This observation sharply contrasts with market talk about “deglobalization” or “supply chain relocation.” He believes that China not only has a large domestic market, but also occupies a core position in international trade. Its importance is reflected not only in economic scale, but also in the continued growth of global freight flows.

Regarding DHL’s investment plans for the China market over the next five years, De Bok disclosed that the DHL Global Forwarding business segment for which he is responsible will continue investing in tangible assets and the business itself, but the focus will be on “people” and “systems.” “We’re accelerating our digital agenda; the core is improving the use of data,” he explained. “The freight forwarding business involves a large amount of data, which means we can optimize cargo flows for customers more effectively.” He specifically mentioned seven priority investment areas, including using generative artificial intelligence to automate customs clearance processes. “By investing in generative AI, we can create about a 20% productivity improvement, which means a major enhancement of customs clearance capabilities.” In addition, route optimization, LCL plan optimization, improvements in sales efficiency, and so on are also key directions for investment. He also noted that the innovation capabilities of local Chinese suppliers in these areas provide DHL with abundant collaboration resources.

Notably, De Bok specifically sees China’s small and medium-sized enterprises as an important growth opportunity. “We are increasingly making China’s small and medium-sized enterprises our priority customer group, because we see that we can bring enormous value to these companies, and they are also increasingly seeking to expand globally.” He pointed out that “the DHL Group has business operations in more than 220 countries and regions, with about 600,000 employees worldwide. Specifically for DHL Global Forwarding, we have nearly 50,000 professionals serving local markets. This means that through us, Chinese customers can suddenly have a local presence in any market.”

De Bok further explained that one of the biggest advantages DHL can bring to small and medium-sized enterprises is integrating shipment volumes and strengthening purchasing power. Combined with digital investments and global market access capabilities, it helps Chinese companies achieve cargo flow optimization within global supply chains. “We hope to help Chinese customers open up new markets through DHL’s local experts. From the moment they arrive at the airport, we have DHL employees from China to take the lead in working with them—guiding them on how to organize, how to handle customs operations, and how to do local logistics.” This service model of “Chinese faces, global network” is exactly the core competitiveness DHL is trying to build in the China market.

Despite facing shocks from the fighting in the Middle East, the DHL Group is confident about the company’s growth targets. The company has set a goal to grow by 50% from 2023 to 2030, and this ambition is based on its judgment about long-term trends in global trade. “Global trade is still growing, and the flow of global logistics is a reflection of global trade. We often say we thrive amid complexity, because that means we need to find solutions.” De Bok said.

For DHL, the China market is not only an important business growth point, but also an indispensable key node within the global supply chain network. Amid profound changes in the global trade landscape, this German logistics giant is trying to provide Chinese companies with certainty in uncertainty through its global network and digital capabilities.