Union and state officials protest Deutsche Post plans to cut U.S. airlines ties
Deutsche Post World Net’s decision to outsource DHL Express’ domestic U.S. airlift to UPS is drawing fire from a coalition of public officials and union forces – and the state of Ohio.
The 10-year deal, which could bring some USD 10 billion to UPS, will face extensive antitrust scrutiny.
Ohio Gov. Ted Strickland is calling for an investigation into whether DPWN’s plans for DHL would violate U.S. antitrust laws by reducing competition in the express package delivery market.
Facing the legal hurdle and an outcry over the impending loss of thousands of jobs in the state, DPWN board member John Mullen, CEO of DHL Express, and Wolfgang Pordzik, DHL vice president of public policy, met in Washington with Strickland and with Ohio’s congressional representatives.
One of them, Rep. Michael Turner, R-Ohio, is calling for an antitrust investigation that goes beyond the initial UPS-DHL deal, saying there are signs the two companies will forge similar arrangements in Europe and Asia.
Several unions also are threatening to sue to block the agreement with UPS on antitrust grounds.
Deutsche Post’s move would essentially unravel part of DHL’s expansion in the United States, enabling the company to focus on international business as DPWN looks for ways to stem the U.S. operation’s losses, expected to reach USD 1.3 billion this year.
But first, DHL has to sever ties with its current carriers, ABX Air and ASTAR Air Cargo. That’s causing angst for public officials and union leaders, especially those in Wilmington, Ohio, DHL’s main domestic hub.
Deutsche Post World Net’s decision to outsource DHL Express’ domestic U.S. airlift to UPS is drawing fire from a coalition of public officials and union forces – and the state of Ohio.
The 10-year deal, which could bring some USD 10 billion to UPS, will face extensive antitrust scrutiny.
Ohio Gov. Ted Strickland is calling for an investigation into whether DPWN’s plans for DHL would violate U.S. antitrust laws by reducing competition in the express package delivery market.
Facing the legal hurdle and an outcry over the impending loss of thousands of jobs in the state, DPWN board member John Mullen, CEO of DHL Express, and Wolfgang Pordzik, DHL vice president of public policy, met in Washington with Strickland and with Ohio’s congressional representatives.
One of them, Rep. Michael Turner, R-Ohio, is calling for an antitrust investigation that goes beyond the initial UPS-DHL deal, saying there are signs the two companies will forge similar arrangements in Europe and Asia.
Several unions also are threatening to sue to block the agreement with UPS on antitrust grounds.
Deutsche Post’s move would essentially unravel part of DHL’s expansion in the United States, enabling the company to focus on international business as DPWN looks for ways to stem the U.S. operation’s losses, expected to reach USD 1.3 billion this year.
But first, DHL has to sever ties with its current carriers, ABX Air and ASTAR Air Cargo. That’s causing angst for public officials and union leaders, especially those in Wilmington, Ohio, DHL’s main domestic hub.
Officials there foresee the loss of thousands of jobs.
“If DHL does everything they’ve indicated, the end result is a loss of around 7,000 jobs in Wilmington,” ABX Air President John Graber Graber said. “We [ABX Air] would directly lose 6,000 positions.”
DHL also owns the Wilmington airport, the largest privately owned airport in the country. Jonathan Baker, director of public relations for DHL said the Wilmington air sort hub would be closed once the company ends its relationship with ABX Air and ASTAR.
Some freight, he said, would be shifted to UPS’ Louisville hub this year, and the rest would be shifted to Louisville at the end of 2009. Wilmington is also DHL’s largest ground sorting facility and is used to clear and sort international air freight.
DHL hasn’t said what it plans to do with the airport, a former Air Force bomber alert airfield from the 1960s.
