DHL Cuts 8,000 Postal Worker Jobs in $1.1 Billion Cost-Savings Plan

DHL Group will reduce employee headcount by 8,000 at its postal delivery division in Germany as the logistics giant seeks to cut costs by 1 billion euros ($1.1 billion) through 2027.

The planned cuts account for 1.3 percent of DHL’s 600,000-employee global workforce, and 4.3 percent of the 187,000 staff at the Post & Parcel (P&P) segment.

The reduction followed a new union contract agreed upon just two days earlier between DHL and German trade union Ver.di (United Services Union), which netted the postal workers a 5 percent increase in wages through April 2026.

DHL Group CEO Tobias Meyer confirmed to Reuters that the agreement was a reason for the job cuts, as it would cost an estimated 360 million euros ($389.7 million) by the end of 2026.

Meyer said the staff culling is expected to take place via natural attrition, rather than a standard layoff or termination process.

Further prompting the cuts, the CEO also said German’s regulatory guardrails prevented DHL from raising stamp prices to the level necessary to offset the costs of inflation and accelerated mail volume declines.

“We have enough measures which are in our control so that we don’t expect a conflict with the union or strikes as a result of these activities,” said chief financial officer Melanie Kries in a company earnings call Thursday.

However, Ver.di sang a different tune in its statement in the wake of the job cuts, criticizing DHL and German politicians alike after the decision.

“The intended job cuts are the result of unfair competition promoted by politicians in a letter market that is shrinking ever faster,” said Ver.di deputy chairwoman Andrea Kocsis in a statement. “This competition only leads to jobs subject to social insurance and collective bargaining being lost and precarious working conditions being promoted.”

The union’s main criticism of the agreement is that it doesn’t stack up with inflation, and that it only “ensures that employees’ incomes keep pace with the sharp rise in living costs,” Kocsis said.

As for DHL, the $1.1 billion saved in costs will support the company’s 2025 guidance target of at or above 6 billion euros ($6.5 billion) in operating profit, said Kreis. She also indicated the cuts should also help the business get back on track for its wider ambitions to grow operating income to 7 billion euros ($7.6 billion) by 2030.

The pullback in spending comes in the two years after both chief U.S. counterparts FedEx and UPS began their own cost-savings initiatives.

DHL’s stock shot up 12 percent amid the news of the headcount reduction early Thursday, which coincided with the company’s fourth-quarter earnings release.

Amid the global demand headwinds in parcel shipping, the DHL saw a strong fourth quarter in which total revenue increased 6.4 percent to 22.7 billion ($24.6 billion) and net profit grew 12.1 percent to 1.1 billion euros ($1.2 billion).

The global logistics firm’s freight forwarding division had the strongest revenue growth of all segments at 12 percent to 5.1 billion euros ($5.5 billion), with the e-commerce division having the second-highest growth at 10.5 percent to 2 billion euros ($2.2 billion).

The DHL Express division saw the strongest pre-tax earnings, pushed by 42.9 percent growth year over year to 1.1 billion euros ($1.2 billion). Surprisingly, e-commerce generated the next-largest EBIT jump of 39.5 percent to 106 million euros ($114.7 million).

While the Trump administration’s new tariffs on China and potential reciprocal tariffs on the horizon have the logistics industry scrambling, DHL feels it could benefit from more money generated via its customs services.

“Obviously, trade barriers, as we have seen with Brexit, have an adverse impact on volume. That’s what would you expect,” said Meyer in the earnings call. “Though often trade is more resilient than some people think, and finds other ways to still happen. And what is very important, it often means also more activity for us. For Brexit, that meant more customs filings, which is also true now for the days that the de minimis in the U.S. was not in effect.”

Meyer said DHL only handles a “tiny share” of the nearly 5 million de minimis-eligible shipments the U.S. Customs and Border Protection processes per day.

“We are not very much in the business of carrying full plane loads of low value, so we don’t have much exposure to de minimis e-commerce shipments into the U.S.,” said Meyer. “In a mindful way over recent quarters, we carry some of those shipments, particularly still on the trans-Pacific. Would the de minimis not be available, those shipments would convert to dutiable shipments, which creates some more revenue for us, but would definitely create some volume pressure as well. Again, our exposure to that trade is not that large.”

DHL isn’t the only major European logistics firm signaling it is trimming some fat.

Geodis is closing a distribution center in Monroe, N.J., in July 2025, resulting in 426 layoffs. A customer is moving its operations from that facility to another in eastern Pennsylvania, according to a Worker Adjustment and Retraining Notification (WARN) Act notice.

The first batch of 92 employees will be let go on April 27, while a second round of 334 workers will leave the company July 31.