Courier services’ tech lifeline

Accelerating technology use may be the only way for logistics companies, especially those in the competitive courier services segment, to operate in an increasingly challenging landscape where fuel costs due to the Middle East conflict have further eroded margins.

These companies have also seen their margins fall in a years-long price war following the liberalisation of the market in 2012 allowing full foreign ownership of businesses offering courier services.

One company that is anchoring its next growth phase on technology to strengthen long-term, strategic partnerships with customers is GDEX Bhd.

Its managing director/group chief executive officer (CEO) Teong Teck Lean shares that while the technology business has grown at a faster pace than the logistics business, its role is complementary.

“Its primary value lies in reinforcing and future-proofing our logistics operations, ensuring that the core business continues to grow sustainably and remains competitive in an increasingly digital and integrated logistics landscape,” he points out.

This diversification into technology solutions, which began in 2024, is showing up in the company’s financial performance, where it accounted for a fifth of revenue for GDEX’s financial year ended Dec 31, 2025.

The company recently rolled out GD XCHANGE, a platform offering end-to-end implementation, installation, and after-sales support across cybersecurity, integrated point-of-sales systems, cloud subscriptions, workspace solutions, and eCommerce platforms for companies.

“We are seeing increasing demand from customers for deeper integration with their logistics partners, going beyond transactional services to more collaborative, data-driven relationships. In response, we are accelerating the integration of our technology capabilities into our logistics operations.

“This includes the use of artificial intelligence (AI) and advanced data analytics to improve system connectivity between our platforms and those of our customers, enabling better visibility, faster decision-making, and more seamless execution across the supply chain,” Teong says.

For Charles Brewer, Pos Malaysia Bhd CEO, technology is central to the company’s resilience strategy. “We have already deployed AI-driven route optimisation and automated sorting systems across key hubs, reducing delivery times and fuel usage.

“Our mobile app and real-time tracking for customers are fully operational, and we are piloting Malaysia’s first electric autonomous vehicle,” he says, adding that progress is strong, with over 70% of core logistics processes now digitised and enabling the company to adapt quickly to external shocks such as the Middle East fuel disruptions.

The AI-powered autonomous vehicle, the Zelos, is an electric vehicle purpose-built for business-to-business goods transportation, particularly high-volume, repetitive, point-to-point delivery operations, which Pos Malaysia is testing out over six months.

To manage rising fuel costs, the company also has Malaysia’s largest electrified delivery fleet of over 1,500 e-bikes and e-vans deployed, which is a quarter of its entire fleet of vehicles.

Today, competition remains as intense in a domestic market valued up to RM6.9bil in 2025 and, according to market intelligence outfit Mordor Intelligence, expected to grow on a compound annual growth rate of 6% to US$2.2bil (RM8.7bil) by 2030.

Government data show a fragmented industry with over 100 companies offering courier services, of which around a fifth are foreign-owned. Around three-quarters of the parcels are handled by just two companies, J&T Express (M) Sdn Bhd and SPX Xpress (M) Sdn Bhd, both foreign-owned.

Given the crowded field, the implementation of technology initiatives in recent years is also about differentiating themselves from each other as much as about operational efficiency leading to cost savings.

Despite the competition, logistics companies have been forced to raise their fees or surcharges to cushion the rising fuel costs, with Ninja Van announcing a surcharge of RM1.95 per kg starting from April 13 that will be reviewed on a weekly basis.

Pos Malaysia had earlier announced a 15% surcharge on domestic deliveries on top of the base price, with international deliveries seeing a 40% surcharge starting from March 18, while starting from March 27, it will also review these surcharges on a weekly basis.

“We are proactively managing rising fuel costs through operational efficiencies, route optimisation, and a strong sustainability agenda that reduces our exposure to fuel volatility,” Brewer says, adding that price adjustments “are measured, transparent, and communicated clearly to customers”.

For Sabah and Sarawak shipments, he says an existing fuel surcharge mechanism is applied fairly and reviewed regularly in line with market conditions.

“Pos Malaysia’s diversified logistics network and lean cost structure mean we remain resilient, and we are well positioned to absorb volatility better than most,” he says.

Teong says at present, GDEX has introduced targeted surcharges, specifically on bulky and odd-sized shipments for selected accounts, where handling and transportation costs are disproportionately higher.

“In addition, for Sabah and Sarawak and international lanes, surcharges have been implemented effective April 1. This reflects upstream cost pressures, particularly from airlines and international lane integrators, who have been adjusting fuel-related charges on a frequent basis, often weekly,” he says.

“We are currently undertaking a comprehensive, company-wide review of our surcharge framework. In terms of customer engagement, we are taking a proactive and transparent approach.

“Affected customers are informed in advance through multiple communication channels, including direct account management outreach and formal notifications.

“Our priority is to manage cost pressures responsibly while maintaining service quality and supporting our customers through a challenging operating environment,” Teong adds.