Deutshc Post AG has sold its money-losing domestic express delivery service on the Chinese mainland and will focus on international business in future.
It blamed fierce competition and a change in the law for the decision.
DHL-Sinotrans International, a 50-50 joint venture by the German company and China's Sinotrans Air Transportation Development Co Ltd, said it had sold its domestic courier business to Shenzhen Uni-top, which was set up in 1998 with registered capital of 31 million yuan (US$4.8 million).
DHL-Sinotrans bought Apex, a Chinese delivery company, for 300 million yuan in 2009 to tap the domestic express market, but it lost 99.2 million yuan as of the end of 2010 and 33 million yuan as of March 31 this year.
"Foreign express companies lack cost advantages and face fierce competition in the domestic courier service industry, especially after the country revised the Postal Law on October 1, 2009," the venture said.
"We decided to focus on international express business on the mainland as our domestic courier service showed no signs of improvement."
The revised Postal Law states that foreign companies, including joint ventures, are forbidden to deliver letters within the mainland for security reasons.
Chinese express firms handled 2.34 billion parcels and letters last year.
