European Shippers’ Council Supports TNT-FedEx Merger
A few years ago the European Shippers’ Council strongly opposed the merger between UPS and TNT.
Its members heavily complained about the possibility of losing one of the three European express carriers—TNT, UPS and DHL—and this would result to lack of competition in the European market. UPS and TNT were active in the same areas of the European Express market and provided the European industry the same type of services.
FedEx’s plan to take over TNT received a different response from ESC members. The organization sent out a survey to its members and the outcome showed that 90 percent of ESC members welcomed the TNT-FedEx deal.
The rationale for supporting the deal was also nearly unanimous. European express customers never saw FedEx as an option for the intra-European market. FedEx, in the eyes of many European shippers, is a great way of moving cargo from Europe to and from the U.S., but not for moving packages from one EU member state to another. The intra-European market is still dominated by TNT, UPS and DHL. The number of pan-European express carriers will remain the same after this merger, a three big providers.
Another reason cited in support of the merger is the financial situation of TNT. Without a takeover and a financial impulse, TNT may not survive long in the express market. Competition will incease and better logistics services will be provided to the European industry, ESC members believe, due to the strong position of FedEx.
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