UPS Inc. and FedEx Corp. have won licenses to begin domestic courier operations in China, Bloomberg reported.
FedEx won approvals to start service in eight cities including Shanghai, Guangzhou and Hangzhou, while UPS’ license is for five cities, Bloomberg reported, citing China’s Ministry of Transport. The companies are not allowed to deliver letters and operate in the capital city of Beijing.
The licenses will help UPS and FedEx benefit from rising demand for domestic deliveries driven by online shopping, Bloomberg reported. China’s domestic courier business is dominated by the state-owned China Postal Express & Logistics Co., which has about 30% of market share.
Deutsche Post AG’s DHL and partner Sinotrans Air Transportation Development Co. sold their loss-making operations in China last year to instead focus on international shipments, Bloomberg said.