DSV

Third-party logistics (3PL) providers are grappling with geopolitical instability, fluctuating tariffs, rising costs, and labor shortages, while also facing pressure to accelerate e-commerce order fulfillment. Smaller 3PLs struggle to keep pace with larger peers due to high costs of automation, AI, and robotics. Despite these challenges, the U.S. 3PL market saw growth in 2024, with net revenues increasing by 1.6%.

Private equity firm CVC Capital is making a last-ditch effort to persuade Deutsche Bahn to reconsider its decision to sell its logistics arm, DB Schenker, to Danish logistics giant DSV for $15.9 billion.

DSV said that this deal will augment the company’s global network, expertise, and competitiveness, adding that bringing Schenker in will provide access to new markets and strengthen its global network and capabilities, coupled with increased reach and opportunities to serve customers.

Danish logistics company DSV has won the race to buy DB Schenker, the logistics arm of Deutsche Bahn, in a deal worth $15.4 billion. This acquisition, expected to be finalized soon, will make DSV the largest freight forwarder in the world, surpassing Swiss competitor Kuehne + Nagel.

Most global and domestic 3PLs faced huge challenges last year as shippers adjusted to ongoing issues related to inventory optimization and geopolitical risk. To keep pace, the top 3PLs are now amping up their collaboration with carrier partners and implementing as much cutting-edge automation as they can to improve customer service—but will it be enough?

Hedehusene, Denmark-based global 3PL DSV said it is setting up shop with a new office in Raleigh-Durham, North Carolina, with a key focus on the region’s healthcare and pharmaceutical presence, with DSV noting that the latter providing what DSV called a “compelling opportunity” to provide specialized logistics services for the healthcare and life sciences sectors.

The freight forwarding market continues to be negatively affected by the ripple effects of normalization in consumer behavior, as well as the global economic and manufacturing slowdown. Consequently, volumes handled by freight forwarders slowed down in the second half of 2022.

Analysts expect the percentage of cargo booked and shipped through completely digital platforms to double to nearly 20% by 2024. To accommodate this rapid growth, large forwarders are investing heavily in digital offerings for booking, quoting, tracking, and invoicing—the ones who don’t will be left behind.

DSV said that the objective of these acquisitions are three-fold: to augment its position within the semiconductor industry; align with its new Phoenix-Mesa Gateway Airport operations; and support its growing cross-border services into Latin America. It added that these acquisitions are expected to be made official next month.

The report said that DSV is looking to expand in North America, adding that CHR’s global forwarding business would provide DSV with what it called critical access to trans Pacific ocean trade lanes, with the global forwarding business potentially having a $9 billion price tag.

Just like last year, 3PLs continue to face a host of critical and pressing issues that challenge their skills at managing a client’s supply chain. And while company financials for 2021 were staggering, the state of the market in 2022 depends on the pace of global recovery— which currently seems to be slowing.

DSV officials said that this acquisition is expected to establish a top three global freight forwarder, for revenue, and will be an all-share transaction expected to close in the third quarter. And it also noted that Agility will become DSV’s second largest shareholder, with an 8% ownership stake in the company.

Late last week, the acquisition of Basel, Switzerland-based global 3PL and airfreight forwarder Panalpina by Hedehusene, Denmark-based global 3PL DSV was made official, according to DSV officials.

More than a few moving parts remain intact, when it comes to the interaction between Basel, Switzerland-based global 3PL and airfreight forwarder Panalpina by Hedehusene, Denmark-based global 3PL DSV, in regards to the latter’s pursuit of the former as an acquisition target, now the DSV has upped its offer for Panalpina and a separate party, Agility, is in talks with Panalpina about "partnership opportunities."

While the outcome had been predicted in industry circles, the verdict that Basel, Switzerland-based global 3PL and airfreight forwarder Panalpina will not be acquired by Hedehusene, Denmark-based global 3PL DSV is now official.