'We saw a quick V-shaped recovery in 2020': DHL Express America CEO

Mike Parra, CEO for DHL Express Americas, joined Yahoo Finance Live to break down his thoughts on the global trade and investment as the economy begins to show signs of returning to normal.

Video transcript

ADAM SHAPIRO: Let's turn to something more pleasant that we can talk about. Everybody loves getting a package on time. And DHL Express Americas CEO is here to talk to us about not only how we get our packages, but the signs that the economy is steaming up. Mike Parra is the DHL Express Americas CEO. Good to have you here.

And for some of us who are ignorant to the logistics and delivery business, your parent company is Deutsche Post. But it's not a government entity. It's a private company. So how does that all work in the United States for you, and what signs do you see the economy is heating up?

MIKE PARRA: Well, first and foremost, thanks for having us. Thanks for having me as well. I think it's important to know that we've been in the US for 51 years now, back to 1969 when this all kicked off. And really, what we're seeing is an absolute rocketship growth that we started to see after the month of April of 2020.

So we saw a quick V-shaped recovery in 2020. Our lowest point was April. And then from that point on, all the way till today, March 30, as we move into close of end of month we continue to see double-digit growth, specifically in the area of e-commerce. And equally as such, we've also seen a nice rebound in the space of business-to-business as well.

SEANA SMITH: Mike, you're out with a survey of business executives. And I want to get your thoughts just on the disruption that we've seen to supply chains during COVID, when we heard the prediction, going back to the start of COVID or shortly after, that companies would respond by maybe shortening their supply chains and moving some production back to the US. Has that happened?

MIKE PARRA: Well, we saw a bit of both. You know, we saw that change, obviously, in the front end of the pandemic, where there was a shift of the supply chain more from the US towards Asia. And then once Asia started to stabilize and the US and Central, South America, and Europe started to go in COVID, we saw a shift in the other direction from Asia-Pacific more towards Europe and then the United States.

What we see now is that things have stabilized for us. We've seen nothing but growth. The biggest opportunity came when the airline industry, or commercial airline industry started to basically reduce and hunker down and reduce the number of flights, reduce capacity. And then there became a big need for companies like ourselves, global integrators, to be able to move the goods all around the world.

And that hasn't stopped, by the way, even though we're starting to see passenger flows starting to increase. 1.2, 1.4, 1.5 million a day-- more specifically in the United States, the need for capacity in the air continues to be pressing. And we're adding more and more planes every single day.

ADAM SHAPIRO: So as Seana just pointed out, I think it was, what, nine out of 10-- 89% of CEOs in the survey expect the global recovery to depend on robust international trade flows over the next 12 months. But then you get news like what we saw out of France today. How much of a hiccup does one country locking down the way France is doing present for what these CEOs are expecting?

MIKE PARRA: Yeah, no, I mean, look. During the pandemic, we saw the biggest growth with the move of everyone moving to work from home, and even here in the United States with stimulus checks that recently went out, people are working from home and then they're buying online. And even though there's a lock down in France, our business continues to flourish, because shipping must continue-- either people importing goods that are needed into France as a country or France exporting goods.

So being the essential business that we are at DHL, we're still working. And people are still shipping. And that economic recovery, as you saw in the study, at 89% is basically conclusive around international trade flows. Also in the study it said that 83%, what we got out of the 500 folks-- senior decision makers that we surveyed between the 12th of January and the 5th of February-- what we saw, that 83% of businesses are planning to increase overseas investments this year, with North America being the favored destination, being 78%.

The US, for us, continues to be the largest destination from the world into the US. And we grew greater than 50% inbound. And that hasn't stopped, even through March, as of today.

SEANA SMITH: Mike, another part of this survey that we haven't hit on yet-- and something that jumped out to me-- was international travel. And of the business executives that you surveyed, 44% thought that their organizations are planning to increase international business travel beyond even pre-pandemic levels. And this isn't something that I'd necessarily seen before. Any idea as to when they plan to wrap this up, and in what industries this is the case?

MIKE PARRA: Yeah. That's interesting. And that was an interesting fact that came out of the report. You know, there was a bit of questioning around it, because we don't see international travel for our company taking off till at least fourth quarter of this year to the beginning of 2022.

So I would say that if there's going to be any international travel, it's going to be towards the end of the year, the beginning of 2022. Especially with some of the recent lockdowns-- whether it's Germany, whether it's Italy, whether it's France, from a Paris perspective or some of the Eastern European countries where we've seen a return of numbers spiking. Or even here in the United States as of late, coming off of spring break we've seen many different states starting to see a rise in COVID. So we're keeping a close eye. But if I were betting, I would say it's going to be the end of quarter four of this year in the calendar year or the beginning of 2022.

ADAM SHAPIRO: All right. I think the Germans would say [GERMAN]. Poorly translated, everything is OK. Mike Parra, DHL Express Americas CEO. Thank you for being here. When we come back--