In recent years CTT – Correios de Portugal has been transformed from a mail-led postal operator to an e-commerce logistics group. Its commitment to this transformation to ensure the sustainability of the business, given rapidly decreasing mail volumes, is paying off.
In its latest financial results, in the nine months ending September 30, the post revealed that revenues were up 10.7% year-on-year (YoY) to €792.3m (US$864.2m) thanks in part to a record performance by CTT’s Express & Parcels business. In this business, revenues amounted to €330.5m (US$360.5m), an increase of 44%, while volumes jumped by 45.9% YoY to 98 million items.
“CTT has significantly strengthened its presence in e-commerce, establishing strategic partnerships and developing innovative solutions to support companies in their transition to digital, regardless of their size, geographical area and type of business,” says CTT – Correios de Portugal executive board member João Sousa.
Cross-border focus
A key focus of CTT’s transformation and a key driver behind its increased parcel volumes is cross-border e-commerce. The post recently strengthened its position in this area thanks to a new joint venture with DHL and the acquisition of Compañia Auxiliar al Cargo Express (CACESA), a Spanish company specializing in the international e-commerce customs sector.
“The acquisition of CACESA will enable us to strengthen our competences in the customs area, meeting the demands of increasing cross-border volumes,” explains Sousa. “CACESA’s customs clearance platform is highly automated and based on a proprietary software process that allows for cost-effective and scalable growth. It also offers additional last-mile parcel delivery services, completing the value proposition for its customs clearance customers. CACESA also provides additional freight transport services through its network, including air/sea freight and express. It is present in 15 countries, with Spain, Italy, Belgium and Poland as its main markets.”
Meanwhile, CTT’s joint venture with DHL eCommerce, which was announced at the end of 2024, will see the two companies combine parcel delivery networks for B2B and B2C e-commerce, including out-of-home (OOH) deliveries, in the Iberian Peninsula.
As part of the partnership, the companies will form specialized joint ventures. CTT Express will acquire the DHL eCommerce business in Portugal. In Spain, DHL eCommerce will concentrate on B2B operations, while CTT Express will cater to B2C services. The new partnership will operate under the independent brand labels ‘CTT Express, a partnership with DHL’ in the B2C segment and ‘DHL, a partnership with CTT Express’ in the B2B segment.
“The joint venture with DHL eCommerce, in addition to the complementarity of networks in the Iberian Peninsula, reinforces our know-how and internal competences, laying the foundations for providing a quality, efficient and convenient service to our customers (B2B) and our customers’ customers (B2C),” continues Sousa.
“By being associated with DHL eCommerce’s European network and taking advantage of its experience in international parcel transport, we will also be able to offer optimized solutions not only for national but also international e-commerce companies.”
AI and automation
According to Sousa, strategic partnerships and acquisitions like those mentioned above help the post “consolidate its growth path”. They also help it tackle the cross-border market, which can be complex due to different customs rules around the world and tracking and transparency challenges. “These operational challenges are tackled by constantly improving and developing technologies to optimize processes,” Sousa adds.
In particular, he points to automation and artificial intelligence (AI). “At CTT we have been using machine learning models to organize routes near real time, considering the volume and types of parcels, density, delivery slots, use of lockers and types of vehicles according to their volume and energy cost,” he explains.
“Actions are also underway to forecast peak orders based on existing data throughout the chain for better management of logistics resources, sorting and last mile. The ability to process significant volumes of information in due time makes it possible to collect and process more data on each order, which results in more efficient and automated communication at all stages of the delivery chain, including with the customer, and with more accurate forecasts of the delivery period,” Sousa continues.
Furthermore, the recognition systems that CTT uses to support the sorting and automatic routing of orders is also being enhanced with AI. “We can use this technology to detect patterns and minimize the risk of erroneous deliveries by correcting addresses or detecting objects placed in the wrong procedures or sorting zones, for example,” Sousa says.
“We are also working on prototypes of in-vehicle and sorting equipment ‘sensorization’ which, when combined with AI algorithms, make it possible to predict faults and carry out maintenance before problems occur,” he adds.
Another area where CTT is using AI to improve operations is customer service. The post has developed a virtual chatbot called Helena, which uses generative AI to enable quick and precise responses to consumer requests. The chatbot is based on Microsoft Azure OpenAI technology and provides real-time assistance that combines informational and transactional components.
Out-of-home network
CTT is also in the process of building out a strong OOH delivery network to help it handle growing parcel volumes and meet customer requirements for increased delivery flexibility. “The use of automatic lockers for collecting and returning parcels is a very convenient, simple and safe innovation that is already widely used by CTT, under the Locky brand, in more than 1,000 locations,” explains Sousa.
“These lockers are part of the Collectt Iberian brand, which currently has more than 20,000 pick and drop points for a delivery that guarantees a more sustainable proximity service,” he continues. “The Collectt network will continue to be expanded to continuously improve the customer experience.
“In Portugal, the network is made up of almost 4,000 collection points throughout the country, including 1,000 lockers, CTT Post Offices and outlets and Payshop agents. In Spain, Collectt Express is supported by partner networks with significant penetration in the territory, with more than 16,000 points,” Sousa adds.
Looking to the future, Sousa believes that there is still plenty of room for growth in both the domestic and international e-commerce markets, which will hopefully drive volume growth at CTT. “We are confident that the take-up of online shopping will continue to grow as the cross-border, but also local, offer grows,” he asserts.
“For this purpose, CTT will continue to focus on diversifying its customer base, regardless of geography, product type or company size. We believe we have all the conditions to drive the growth of e-commerce in the Iberian Peninsula, whether through our delivery network or by supporting companies in their digitalization process, with services that help them create and strengthen their digital presence, from creating an online shop to managing their warehouses,” Sousa concludes.
Discover more about the growth and challenges of cross-border e-commerce in the March 2025 issue of Parcel and Postal Technology International.
