News

City Link is trialling a "mixed model" of employee drivers and owner drivers in the first phase of consolidation of newly acquired Target Express.

The trial will start at City Link's Exeter depot for one month, and is a nod to the different business models used by the two companies. Target used sub contracted owner drivers, while City Link had historically run franchised operations before it started buying back the franchise businesses in October 2005.

Managing director Michael  Cooke says City Link, with a 15% market share in express parcels, excluding same day and international, is now second to DHL which has 16% market share. The target is to become the leader, he tells Motor Transport.

City Link "is investing £12m over the next two years in integrating the two businesses," Cooke says, with the full integration set for completion by the end of 2008. He confirms that Target will take on the City Link brand.

The combined business of City Link and Target will be formed of six regions - currently there are more than 100 depots nationally. Virtually all of Target's former senior management team now work for City Link, says Cooke, who adds that he "is positive that the majority of staff will transfer".

Cooke says that the company's de-franchising operation is on course, with 57 of the 70 "territories" now owned  by City Link. The remaining 13 will be bought by the middle of this year.

Target Express was purchased "debt free" by City Link for £210m in November 2006.Cooke confirms Target's debt has "all been sorted". He adds that City Link is not looking for acquisitions in 2007.

Current turnover is £420m, with Cooke predicting an 8% growth "in terms of volume this year".