Airborne to Undercut U.S. Rivals UPS and FedEx

U.S. package-carrier Airborne Inc. plans to offer low prices to win business in the U.S. market now dominated by rivals UPS and FedEx once it merges with DHL, Airborne’s chief executive said on Thursday. CEO Carl Donaway said the combined company would court small and medium-sized American businesses, which pay the highest rates for deliveries of packages and documents. ‘We are going to be very, very aggressive in that small and medium-sized marketplace,’ Donaway said in an interview in New York with Reuters. ‘Quite clearly, we have always been a price-moderating influence. Whenever we show up, FedEx and UPS have had to respond very aggressively with pricing.’ In March, Seattle-based Airborne agreed to sell its ground operations to DHL, a unit of Germany’s Deutsche Post AG, in a $1 billion deal. Airborne’s air-cargo operations are to be separated into a new company in a bid to comply with government limits on foreign ownership of U.S. air carriers. Donaway said the deal, calling for Airborne to adopt the DHL Worldwide Express brand name, should be completed this quarter. Airborne shareholders are set to vote on Aug. 14.” Reuters: “Donaway said he does not expect any problems with the Justice Department’s antitrust review of the deal. Nor is he concerned that the Transportation Department’s examination of Deutsche Post’s and DHL Worldwide’s relationship with DHL Airways, now ASTAR Air Cargo, would impact the transaction.