FedEx MEA’s Taarek Hinedi shares key trends in logistics, expansion plans

In an interview with Gulf Business, Taarek Hinedi, VP of FedEx Middle East and Africa Operations, discusses the significant advancements and strategic initiatives behind the recently opened FedEx hub at Dubai World Central (DWC).

The new hub represents a major investment in the UAE’s economy, supporting the country’s non-oil export development, and enhancing the region’s e-commerce and trade capabilities.

Hinedi also sheds light on why the UAE remains a priority market for the company, trends in the air cargo industry, and the company’s commitment to sustainability through innovative solutions and technologies.

Give us an overview of your investment and operations at the recently opened FedEx hub at Dubai World Central.

The FedEx hub at Dubai World Central (DWC) represents a significant enhancement to the region’s aviation and logistics ecosystem. It marks a long-term investment of approximately AED 1.3 billion into the UAE’s economy through infrastructure and technological advancements in the facility. This investment also reaffirms our commitment to the UAE’s economic growth while aligning with the ‘National Agenda for Non-oil Export Development’ to increase foreign trade. In addition, it supports the growing e-commerce and trade demands in the Middle East, Indian Subcontinent, and Africa (MEISA) region and beyond.

As the first express courier and cargo company operating its flights and hub from DWC, FedEx is contributing to the Dubai Economic Agenda D33, which aims to double the size of Dubai’s foreign trade and add 400 cities to its foreign trade map.

Backed by a comprehensive multi-modal transportation network, and spanning more than 57,000 square metres (610,000 square feet), the FedEx Hub at DWC boosts operational efficiencies with numerous innovations for an improved customer experience. It incorporates state-of-the-art technologies, such as automated and advanced sorting systems capable of handling up to 9,000 packages per hour; high-speed security screening; cold-chain services; and capabilities to manage dangerous goods.

Ultimately, the facility expands our global network that connects 220 countries and territories, strengthens the entire region’s connectivity, and plays a key role in facilitating global trade and commerce.

Why is the UAE a priority market for FedEx? What are your expansion plans for this market?

The UAE is a growing powerhouse in the global economy and a major player in the GCC trading bloc. It also serves as a competitive export hub and is one of the world’s top five re-export hubs. The UAE’s open trade and investment policies, strong macroeconomic environment, and access to large regional and global markets are some of the reasons why FedEx chose Dubai as its regional gateway back in 1989.

 The World Bank’s upward revision of real GDP growth forecasts for the UAE to 4.1 per cent in 2025 reflects the resilience and potential of the nation’s economy.

The UAE’s record-high non-oil economic growth, surpassing Dhs3.5tn in 2023, also demonstrates the country’s increased demand for efficient, reliable, and smart logistics solutions to support the flow of goods and services. Our hub at DWC enables us to offer customers in the UAE and wider region enhanced services that fit their evolving shipping requirements.

FedEx is dedicated to investing in its infrastructure, networks, and solutions to foster socio-economic development, digital transformation, and innovation in the region. Our focus includes unlocking growth opportunities for e-commerce businesses, supporting SME expansion to global markets, and enhancing market access through our global air and ground networks.

We recently launched our new FedEx Less-than-Container Load (LCL) Priority service, connecting the Asia Pacific with key markets in the Middle East. This multimodal ocean-road solution offers a customs-cleared port-to-door and door-to-door service with a strategic balance of speed and affordability while providing a new benchmark in efficiency.

We also introduced innovative digital solutions including the new automated e-commerce capability in FedEx Ship Manager, which supports small businesses and e-commerce merchants across the region and helps them efficiently manage their shipments online.

What are some key trends and opportunities for the air cargo industry in the UAE and the wider Middle East region?

Global trade is expected to pick up gradually this year as it recovers from a below-par year in 2023, which will positively impact the logistics sector as a whole.

According to the International Air Transport Association (IATA), all regions are expected to experience air cargo growth in 2024, with the Middle East set for the biggest increase at 12.3 per cent. Recent data reveals that Middle Eastern carriers saw a 9.4 per cent year-on-year demand growth for air cargo in April. Further, the Middle East–Europe market performed particularly well with 30.1 per cent annual growth, ahead of Middle East-Asia which grew by 10.4 per cent year-on-year.

The rise of e-commerce is a significant factor in this growth, with the MENA e-commerce market projected to reach a valuation of $57bn by 2026.

The forecast indicates a compound annual growth rate (CAGR) of 11 per cent over the period spanning from 2022 to 2026.

To support the growth of the e-commerce sector, with a dual focus on meeting the needs of e-tailers and their end-consumers, we have enhanced our suite of offerings and added WhatsApp notifications to our FedEx Delivery Manager International solution, which helps recipients plan package deliveries around their busy schedules.

We also introduced picture proof of delivery for express residential deliveries, to ensure peace of mind for e-commerce merchants and their consumers.

Is FedEx focusing on any specific sectors and industries to expand its operations in the UAE?

We are constantly strengthening our service offerings while keeping customers at the core of everything we do. This includes optimising our network and developing new services to meet the needs of diverse industries, such as automotive, aerospace, electronics, oil and gas, fashion and retail, e-commerce, and healthcare.

To support businesses in their growth and to capitalise on global opportunities, we enhanced our FedEx International Priority service. Now, exporters in the UAE benefit from at least a one-day improvement in transit times for major markets compared to previously.

We also launched the FedEx Regional Economy services for parcel and freight to cater to the increasing demand for cross-border trade in the Middle East.

The deferred, day-definite road services are ideal for businesses, especially small and medium-sized enterprises, as they offer cost-effective shipping solutions for less urgent shipments within key regional countries.

Our hub at DWC also provides the opportunity for future flight growth through Dubai, enabling us to further expand our operational and commercial footprint.

Please give us an overview of the sustainability solutions currently offered by the company.

Our sustainability approach and carbon emission reduction plans focus on three key ideas: reduce, replace, and revolutionise. We aim to mitigate the impact of our activities and operations, replace older technologies and vehicles, and revolutionise our fleets and facilities with newer and more efficient technologies. Our efforts to reduce emissions centre around vehicle electrification and the use of sustainable energy and fuels.

Through a phased strategy, we are working towards our goal of transforming the entire FedEx parcel pickup and delivery (PUD) fleet to zero-tailpipe emission vehicles by 2040. Further, in our commitment to providing sustainable solutions for our customers, FedEx-branded cardboard packaging is 100 per cent recyclable and composed of 45 per cent recycled content.

Our hub at DWC is also a testament to our sustainability commitment. The facility aligns with Dubai Municipality’s Green Standard for sustainable building and regulation and features 100 per cent LED lighting, charging infrastructure for commercial delivery vehicles, electric ground service equipment such as forklifts and employee passenger cars, and an intelligent building management system to automatically manage cooling and lighting. It will also include solar panels that will generate approximately one megawatt of power. The excess power will be fed back into the Dubai power grid, supporting the increase of clean energy’s share in the city’s energy mix.

Our customers can also access our FedEx Sustainability Insights tool on fedex.com, which is an advanced cloud platform that grants them direct access to near-real-time emissions data on their shipments within the FedEx network. They can then use the data to help make informed decisions on their future shipping strategy to reduce their impact on the planet.

Additionally, we are supporting research on carbon sequestration science to help advance the development of long-term carbon capture strategies with permanence.