Deutsche Post AG's DHL plans to invest $137 million in the U.S. market to expand its e-commerce capability, as the German mail and logistics giant seeks to better compete in the world's largest cross-border package-delivery market.

DHL said Wednesday it plans to build eight new e-commerce distribution centers and expand two that it is already operating. At these centers, retailers can stock items for sale online so that when a U.S. customer makes an order, the item will reach them more quickly. The company already has 20 distribution centers in North America.

"Our customers are asking for specific support and services when building up that online presence," said Thomas Kipp, head of strategy and business development for DHL e-commerce. Mr. Kipp said consumers are becoming "more demanding" in terms of speed of delivery.

While DHL has had a presence in the U.S. for years, it spent heavily last decade to build out an express domestic delivery network to compete with United Parcel Service Inc. and FedEx Corp. on their home turf. In 2008, after heavy losses, the company decided to scale back on express, focusing instead on international shipments for that U.S. business segment.

Earlier this year, the U.S. made a change in trade rules that allows Americans to import up to $800 at a time of most foreign goods without having to pay import duties or tax, up from the previous exemption of $200. Delivery companies have said that change has caused an increase in cross-border online orders.

DHL has made other recent investments in the U.S., including a new $1.3 million Express service center in Chicago and a $35 million distribution center for its global forwarding network.

The latest investment reflects the growing role that e-commerce has in global retail. DHL said that the global cross-border e-commerce market is expected to grow in value to $1 trillion by 2020, from $400 billion currently.

The company is also adding the ability on certain shipments to tell customers exactly what day their package will arrive rather than give them a window of several days.

Write to Laura Stevens at laura.stevens@wsj.com

 

(END) Dow Jones Newswires

July 27, 2016 15:15 ET (19:15 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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