ASMO: Aramco and DHL JV to transform Saudi Arabia’s logistics landscape

Jeddah - Yasmine El Tohamy - DAMMAM: Saudi Arabia’s logistics sector is poised for a significant transformation with the launch of a joint venture company.  

This strategic collaboration, known as Advanced Supply Management Operations, or ASMO, combines the procurement expertise of Saudi Aramco with the supply chain knowledge of DHL. This venture aims to revolutionize processes, positioning itself as a comprehensive one-stop shop for all logistics and procurement requirements. 

“At ASMO, our ambition is to redefine the supply chain and break free of traditional logistics and procurement barriers, giving energy, chemical and industrial sectors the opportunity for boundless growth,” the newly launched company said in a statement. 

Through a strategic partnership between Aramco and DHL, the newly established firm aims to offer comprehensive end-to-end supply-chain services for the energy, chemical, and industrial sectors within and outside the Kingdom, providing cost-effective procurement solutions to foster growth.

Its additional goal is to connect suppliers and customers through a brokerage model, reducing the necessity for inventory holding and cutting costs. This approach is expected to bring about cost savings through optimized procurement, logistics, and inventory, benefiting all involved parties. 

ASMO envisions enhancing service levels in procurement and supply chain management, allowing customers to trust the process and focus on their core business activities, thereby alleviating operational burdens. 

During the opening celebration, the conventional ribbon cutting was replaced by a laser light show in the dimmed room. A “brand reveal” ensued as the symbolic ASMO cube took center stage. Leaders of the new ASMO chapter were invited to touch the cube simultaneously, showcasing their synergy in a manner reminiscent of a collective gesture. 

Several key figures took the stage to interact with the cube. Craig Roberts, CEO of ASMO; Hendrik Venter, CEO of DHL Supply Chain in Europe, Middle East and Africa; and Oscar de Bok, CEO of DHL Supply Chain, were among them. Wail Al-Jaafari, executive vice president of technical services at Saudi Aramco, along with Mohammad Al-Shammary, senior vice president of procurement and supply chain management at Saudi Aramco, and Salem Al-Huraish, the chairman of ASMO, also participated in the event. 

“It has been almost three years since both companies have joined forces with an ambitious vision, the first of its kind,” said Al-Huraish.  

“In forming this strategically powerful alliance — which harnesses Aramco’s energy ecosystem and DHL’s logistics expertise — we are intent on creating value by driving efficiencies and enhancing the reliability of supplies, making them less vulnerable to disruptions, while focusing on sustainability and lowering carbon emissions,” he added. 

ASMO’s headquarters will be based in Dammam, strategically positioned at what is often referred to as “the crossroads of the world.” Notably, this central location will be a short drive from the Aramco base in Dhahran. 

DHL’s supply chain CEO de Bok underscored the transformative impact of the joint venture, stating: “ASMO is the region’s first hub providing a comprehensive and integrated end-to-end supply chain service offering for businesses in the energy, chemical and industrial sectors.”  

He added that ASMO intends to reshape how these companies procure, store, and transport goods and services within, to, and from Saudi Arabia and the broader Middle East and North Africa region. The aim is to enhance efficiencies, achieve cost savings, and realize economies of scale. 

Al-Jaafari conveyed that “this is an exciting day” for Saudi Aramco and DHL, as well as for everyone working toward building a brighter future for the region. 

“The supply chain and logistics market in the MENA region is worth around $100 billion; our goal is to have a major share of this. Launching a company that provides procurement logistics and warehouse services is hugely ambitious, but I know we have the right partner with us to succeed,” he said. 

Al-Jaafari concluded that ASMO would not only focus on advancing the economic interests of Aramco and DHL but also aim to accelerate growth across the industrial sector of Saudi Arabia and the MENA region, all while supporting the Kingdom’s 2030 vision of becoming a global logistics hub. 

Jan Willem Winkelhuijzen, ASMO’s chief supply chain management officer and a seasoned operational leader with 25 years of experience at DHL in various capacities and countries, said he is glad to call the Middle East his home for this newest role. 

Despite the initial slowdown of plans due to COVID-19, he expressed excitement that progress is underway in the right direction, with the right team in place. 

Winkelhuijzen revealed that the team intends to recruit 1,000 employees in the next two years and then consider further expansion as needed. The recent hires predominantly consist of former Saudi Aramco and DHL employees. 

“I’ve been visiting all the sites and met all the people and they’re all excited to become part of the logistics company because they are ‘a logistic person’ within a not-so-logistic company,” he told Arab News, adding that there’s a lot of opportunity to improve and to accelerate. 

Toward the end of the ceremony, the recently onboarded ASMO employees were invited to stand up for recognition and applause from the audience. Approximately 40 percent of those standing were women, aligning with Vision 2030’s commitment to empowering more women to join the workforce. 

ASMO is envisioned to meet the growing demand for sustainable and efficient supply chain services in Saudi Arabia, reflecting the region’s expanding market potential as a global trade gateway for the energy, chemical, and industrial sectors.  

Digital technologies play a pivotal role in ASMO’s vision, with plans to incorporate advancements in automation, collaborative robotics, as well as artificial intelligence, data analytics, and blockchain.  

Positioned to navigate challenges such as supply shortages, logistics disruptions, and rising costs, ASMO aims to establish itself as a regional supply chain hub. Its comprehensive services cover everything from procurement to logistics, and warehousing, and even include a B2B e-marketplace for customers.