Purolator to Spend $759 Million for Faster Deliveries

(Bloomberg) -- Courier company Purolator Inc. will invest more than C$1 billion ($759 million) over the next five years to build a shipping hub in Toronto, upgrade its fleet and enhance its retail network in Canada to reach more customers.

“Today’s announcement is one of the most ambitious in our company’s history and will future-proof our business,” John Ferguson, Purolator’s chief executive officer, said in a statement.

The Canadian company, a unit of the country’s postal service, will spend C$330 million to build a 60-acre automated hub in Toronto, allowing it to deliver more packages quickly. Purolator, which delivered more than 250 million packages in 2018, said that the facility will triple its capacity, and help it deal with higher volumes of deliveries during peak periods.

Purolator’s expansion in Toronto comes amid a booming demand for warehouse space in the city, as e-commerce players such as Amazon.com Inc. and big-box retailers such as Home Depot Inc. have been racing to deliver packages to customers quickly and cheaply.

Toronto had the lowest industrial property vacancy rate in North America in the fourth quarter of 2018, according to data from Colliers International.

Purolator, based in Mississauga, Ontario, will also use part of the money to add more than 1,000 new vehicles to its fleet over 2019 and 2020, and roll out its first fully-electric vehicles by 2020. It will also expand its mobile service, which allows customers to pick up their packages from Purolator’s delivery trucks across the Toronto area.

The company is also testing a pick-up locker service, and electric cargo bikes to make deliveries in Toronto.

To contact the reporter on this story: Simran Jagdev in Toronto at sjagdev1@bloomberg.net

To contact the editors responsible for this story: David Scanlan at dscanlan@bloomberg.net, Chris Fournier

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