Agility is planning to build a new warehouse in Abu Dhabi as part of its expansion plans in the emirate with a AED100-million investment in a 21,000sqm warehouse and a new fleet of 50 trucks. Bassel El Dabbagh, chief executive officer of Agility in Abu Dhabi, told Logistics Middle East that the logistics giant plans to have the facility fully operational by November, 2017.
“The new warehouse will cater to the needs of retail customers, oil and gas companies and Etihad airways in storage of goods and distribution,” says El Dabbagh, adding that air cargo in particular is expected to be a major driver of growth with the opening of the new mid field terminal at Abu Dhabi International Airport. “We would see more cargo coming to Abu Dhabi. This would benefit our company,” explains El Dabbagh. “We also have a plan to offer warehouse facility at the new terminal in the logistics city.”
The new AED10.8 billion mid field terminal is expected to be opened in December next year. The Kuwait-based logistics firm also plans to strengthen its presence in Kizad by developing a number of logistics services at the industrial zone in addition to the new warehouse in Musaffah Industrial Zone.
“We are strengthening our presence by obtaining a plot of land at Kizad to offer number of services like open yard storage and container services. In the long run, we plan to build a warehouse at Kizad to accommodate more cargo as the UAE focuses on [the] diversification of the economy,” he explains.
Agility handles 75,000 containers of cargo a year in Abu Dhabi and a similar number in Dubai and the diversification efforts are important as it has traditionally relied on the oil and gas sector for a lot of its activity in Abu Dhabi. Its fleet of 250 trucks for example provides services in breakbulk and containerised cargo for the oil majors, with more than 50% of all trips dedicated to this sector.
“The drop in oil price has not led to a decrease in volumes, but demand has stayed flat,” explains El Dabbagh. “On top of that, the challenge we face is that for the same volumes the revenue is less now because all the companies, in particular, the oil and gas companies, are asking us to drop the rates for the same volumes.” Agility is therefore targeting other sectors, such as pharmaceuticals and other verticals within the cold chain, such as FMCGs, but its commitment to breakbulk and the oil majors remains paramount.
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