Ayala streamlines logistics business

MANILA, Philippines —  Ayala Corp., the country’s oldest conglomerate, has streamlined its logistics business with the integration of Entrego into the AIR21 Group.

Ayala said Entrego’s businesses and operations were integrated with the AIR21 Group “to streamline personnel and optimize the hub network.”

“This move is aligned with AC Logistics’ strategy to maximize asset utilization and create greater efficiencies,” it said in a statement.

Since the start of the year, Entrego’s courier, express and parcel services were subcontracted by AIR21.

Entrego then officially stopped its services on April 1.

Entrego was Ayala’s first foray into logistics services, which began in 2018 initially serving e-commerce clients.

According to Ayala, the recent shift in the operating models of the large e-commerce marketplace platforms to in-housing their own deliveries led Entrego to focus on domestic freight forwarding, contract logistics and warehousing services, as well as courier express parcel services in 2023.

It said AC Logistics started the process of integrating the operations, businesses and hub network of Entrego under the AIR21 Group in order to maximize the logistics assets of both entities in November last year.

This set the stage for the eventual winding down of Entrego this year.

“In December 2023, due to continuing challenges on the profitability of Entrego, its operations and certain assets were transferred and integrated with AC Logistics Group,” Ayala said.

“Improvements in operations is expected from lower costs, notable efficiencies, better coverages and improved service level agreements, yielding better results moving forward,” it said.

AIR21 was acquired by AC Logistics in August 2022 initially for a 60 percent ownership stake.

AC Logistics’ ownership stake was raised to 80 percent in March 2023.