In the QAD Precision News 26 June 2020: WTO expects 18.5% global trade fall in Q2; EU and UK in farmers’ subsidiary row; England retail footfall up 45% in June; DHL Express announces new facility at Munich Airport; plus how Covid-19 is shaping e-commerce and more. 

Carriers

DHL EXPRESS ANNOUNCES NEW CARGO FACILITY AT MUNICH AIRPORT

DHL Express Germany has announced plans to build a new cargo facility at Munich Airport. The €70 million facility will cover approximately 8,000 square meters and construction should finish in 2022. According to DHL Express, the new gateway will have direct airside access and two pick-up and delivery (PUD) fingers. As a result, DHL Express can dispatch up to 65 vehicles from the location. At present, DHL Express rents hall space at the cargo center at Munich Airport. For more details, please see Air Cargo News. 

DPD COMMITS TO HAVING THE GREENEST FLEET IN THE UK 

DPD and the London EV Company (LEVC) have planned to partner for a series of road trials prior to the launch of the VN5 Electric Van. The new, low emissions electric vehicle is 2.5 tonnes and will be available in the UK later this year. The VN5 is a “range extending vehicle”, providing a  pure EV range of 63 miles and a flexible range of over 300 miles. By the end of this year, DPD is on schedule to have over 600 electric vehicles, making up 10 percent of its fleet. DPD’s UK CEO Dwain McDonald announced the company's commitment to securing “the greenest fleet in the UK.” For more information, please see Post and Parcel. 

Global Trade

GLOBAL TRADE EXPECTING TO CONTACT 18.5 PERCENT IN Q2

On Tuesday, the World Trade Organization (WTO) said global trade will fall 18.5 percent year-on-year in the second quarter of this year as a result of the coronavirus outbreak. However, the WTO said that the estimated drop was better than the WTO's worst-case scenario for the pandemic's impact on global trade — the bottoming out of the global economy with a 32 percent drop in trade volumes. Nevertheless, although the forecast drop is the steepest on record, the WTO notes that the fall in trade volumes could have been much worse. For more details, please see RTE. 

BREXIT TALKS HIT WITH NEW ROW

Trade talks between the EU and the UK hit a new stumbling block to securing a trade and security deal. The two sides have clashed over €70 billion of subsidies given to European farmers by Brussels. In the latest round of talks, the UK accused the EU’s negotiating team of attempting to block the government from protecting British farmers from low cost European imports. Negotiations will start again next week, with this item again on the agenda amongst a number of other contentious issues. UK farmers are still in receipt of this EU subsidy, at the same rate as farmers in the EU. For more information, please see The Guardian.

Retail 

ENGLAND RETAIL FOOTFALL UP 45 PERCENT IN JUNE 

Over the past week, shoppers have returned to the high streets in England as non-essential stores reopened. According to the latest survey of retail footfall, these figures remained significantly down on the previous year. Springboard, a company that measures the number of potential customers at retail outlets in the UK, reported that footfall at retail outlets across the UK increased 45 percent on the week starting June 15 than the previous week. However, this figure was down 54 percent from the same week last year. For more information, please see The Guardian. 

AMAZON ANNOUNCES $2BN INVESTMENT SUSTAINABLE TECH

Amazon has announced the launch of a $2 billion investment in sustainable technologies. The e-commerce giant has pledged to use 100 percent clean energy by 2025. Amazon’s Climate Pledge Fund, which includes the $2 billion investment, will invest in companies of all sizes globally committed to creating technologies that could speed up zero carbon emissions targets. Furthermore, Amazon CEO Jeff Bezos stated that Amazon is increasing efforts to reduce carbon emissions by committing to use 100 percent renewable energy by 2030. For more details, please see Charged Retail.

QAD Precision News

HOW COVID-19 IS SHAPING E-COMMERCE

The global Covid-19 pandemic has caused e-commerce growth to surge around the world, leaving retailers and carriers to deal with peak-like levels of demand. The difference is, of course, that retailers and their carrier partners plan for peak season. The pandemic and the resulting deluge of e-commerce orders caught everyone, including shoppers, off guard. Unsurprisingly, this impacted delivery times, and certain in-demand items quickly sold out.

In the US, online spending in May totalled $82.5 billion. That represents a 77 percent year-on-year increase compared to May 2019. To put that into perspective, Adobe’s Digital Economy Index found that the total spend for two months — November and December — during the 2019 peak was $142.5 billion. On Memorial Day alone e-commerce sales spiked 75 percent and shoppers spent $3.5 billion online, compared to $2 billion in 2019. As a result of the high demand, fulfillment models have changed as well. While home delivery is still the most popular option for online shoppers, Buy Online, Pick Up in Store, or BOPIS, grew 195 percent in May. In this QAD Precision Report we look at current e-commerce trends and how retailers can respond. Read the full report here.