In this scenario, hopes for an economic upturn in Germany also failed to materialize. Although the German economy picked up slightly in 2002 after a difficult phase in the second half of 2001, GDP grew by a mere 0.2%. Increasing unemployment and a decline in real incomes depressed consumer spending. In addition, plunging share prices on the international stock markets resulted in asset losses, putting a further damper on consumer spending and hampering companies’ attempts to secure external financing. As a result, already wary market participants became even more reluctant to invest. Even exports, which have often served as the motor of the German economy in the past, were unable to offset these trends significantly, with growth of 2.9%.

Growing opportunities for global providers
The international logistics market was again characterized by increasing globalization in 2002. This in turn saw two trends emerging on the customer side that are gaining momentum as a result of the need for consistent cost management. On the one hand, the search for cost-effective procurement markets is gaining in global importance. This “global sourcing” requires a global logistics network. On the other hand, companies are increasingly outsourcing corporate functions that lie outside their core competency and can only be undertaken internally at great expense. As a result, companies are increasingly willing to outsource logistics services and are demanding fault-free, on-time logistics activities along the entire value added chain. Furthermore, a growing number of customers want these services as part of one-stop shopping solutions. A modern logistics company must therefore be able to meet virtually all of its customers’ logistics needs, as well as being globally focused.

This demand for the most comprehensive service provision possible set in motion a concentration process on the supply side that picked up additional speed in the year under review. Deutsche Post World Net has secured an excellent starting position by making targeted acquisitions over the past few years. This will allow the Group to further expand its position as one of the world’s leading logistics service providers.

Declining advertising spending impacts mail market
The strained economic environment in the MAIL Corporate Division persisted in the year under review. Overall, business volume on the mail communication market remained at the prior-year level of €7.8 billion in 2002. We managed to maintain our strong position with a revenue-based market share of 94.3% (previous year: 95.0%).

The overall advertising market also continued to feel the pinch. However, revenue in the narrower definition of the direct marketing segment (which includes advertising mail, telemarketing and e-marketing) remained at the prior-year level of €13.3 billion. In turn, we achieved a market share of 15.7% in this segment.

The downturn on the market for press product distribution continued as a result of the weak economy. The forecast market volume fell to 20.1 billion items after around 21 billion in the previous year. At 11.0%, our volume market share remained approximately at the prior-year level.

CEP markets remain highly competitive
On the whole, the markets of the EXPRESS Corporate Division have been highly competitive in the past few years. In the wake of this development, consolidation continued on the European courier, express and parcel services (CEP) markets in the year under review. We maintained our strong position in these markets in 2002; this followed on our success in 2001, when we were the leader on the European market (volume: €34 billion) with a share of around 16%. The most important CEP market is Germany; we remained the largest single provider on this market in 2001 with a share of 23%. Compared with previous years, both Europe and Germany saw a slowing of the forecast market growth in 2002.

We expanded our position as one of the leading global providers on the market for cross-border mail services with a share of 14% in 2001. In the year under review, this market suffered from the ongoing stagnation of the global economy and high transport costs. The rise in costs was due to increased fuel prices and higher security premiums as a result of the terrorist attacks on September 11, 2001.

The market for air-based global courier and express business recorded below-average growth in the US and Europe in the year under review. By contrast, the Asian market experienced above-average growth, as did the European-Asian and American- Asian routes. Overall market growth in the year under review was in the single-digit range.

Logistics markets offer additional potential
Opposing trends were apparent within the relevant segments of the logistics markets: for example, while the market for European contract logistics suffered from the weak demand in the consumer goods sector, it profited from the trend towards the outsourcing of logistics services.

On the international market for air freight, demand for volume fell in the first half of the year under review. This led to overcapacities, which in turn resulted in falling freight prices. Our strong position as the market leader for air freight meant that we benefited directly from the recovery in transportation volumes in the second half of the year, allowing us to make up the initial year-on-year shortfall.

The market for ocean freight developed more positively in the year under review than in 2001: shifts in customer needs and lower prices compared with air freight stimulated demand. We maintained our strong position in this market in 2002.

The market for European overland transport also suffered from weak demand in the consumer goods sector – particularly in the key German market – and increased pressure on margins.

Banking sector undergoes consolidation
The weak global economy has triggered a structural transformation in the international banking sector that is marked by an increased focus on core business as well as alliances, mergers and takeovers of competitors. New technology and growing investment pressure are the driving forces behind this adjustment to the increasingly demanding economic and regulatory conditions (e.g. Basel II). For example, financial service providers are implementing e-commerce and multi-channel approaches in order to expand their product and service offerings and are increasing back office efficiency with modern technology. Although these investments will potentially allow for significant cost reduction, they also entail extensive restructuring.