ABX Air to staff and operate seven new DHL regional sort centers in US
ABX Air have announced that it will be staffing and operating seven new regional sort centers for DHL. The first facility will be located in Denver, Colorado, and is scheduled to begin operating on September 10, 2004. DHL has yet to announce the location of the six other new sort centers, all of which are expected to be operational by year-end.
ABX Air will initially employ 26 people at the new DHL facility in Denver, bringing in temporary employees as needed to accommodate increases in volume during the holiday season. The facility will handle a variety of shipments, including letter and parcel items, palletized and container freight. DHL is investing $3 million in the 74,800 square foot facility, which will operate six days a week and have a sort capacity of 4,000 letter pieces per hour/3,500 parcels per hour. ABX Air will be operating the new regional sort centers under the terms of its existing Hub and Line-Haul Services Agreement with Airborne, an indirect wholly owned subsidiary of DHL Holdings (USA), Inc. Under the Hub and Line-Haul Services Agreement, ABX Air currently staffs and operates DHL’s primary sort center in Wilmington, Ohio, and 11 regional hubs in the United States. ABX Air is compensated under the Hub and Line-Haul Services Agreement on a cost-plus basis, pursuant to which it earns a base mark-up of 1.75% on eligible costs and can earn an incremental markup for meeting certain cost and service goals. ABX Air currently estimates that it will earn base revenues of approximately $12-15 million annually by staffing the seven new regional hubs, plus the potential for incremental markup.
“This is an encouraging growth opportunity for ABX Air, and it provides us with an ability to expand our relationship with DHL,” said Joe Hete, President & CEO. “DHL’s selection of ABX Air to operate its seven new regional hubs recognizes the efforts of our hard-working and dedicated employees and our continued emphasis on productivity and service.”
