Tag: ABX Air

ATSG reports second quarter results

Posted by | Aug 11, 2008 | |

Air Transport Services Group, Inc. reported a 40 percent increase in second quarter revenues, and a loss for the quarter, principally due to certain unreimbursed overhead expenses as a result of the recent arbitration ruling.
ATSG’s revenues were USD 394.9 million for the second quarter of 2008, compared with USD 281.3 million in the second quarter of 2007, an increase of USD 113.6 million.

Second-quarter DHL revenues from expenses subject to markup decreased 11 percent, as ABX Air operated fewer aircraft and managed fewer facilities for DHL than a year ago.
As previously reported, arbitrators ruled that ABX Air’s general overhead expense, excluding certain corporate costs, should be reimbursed in full with mark-up by DHL through the end of 2007 per the commercial agreements, but reimbursed only in part based on a negotiated allocation formula starting in 2008.

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ABX Air aims for smaller but more profitable post-DHL future

Posted by | Jul 3, 2008 | |

ABX Air is planning for a post-DHL future based on a smaller but more profitable business with other customers.
Joe Hete, President of the airline’s parent company Air Transport Services Group (ATSG), told analysts and investors in a conference call that the company still believed it could offer DHL a competitive model compared to the planned DHL-UPS cooperation, and warned that the connection of the two global air express networks could prove “expensive and challenging”.
Admitting that the transition from DHL operations would not be easy, Hete commented: “We expect ABX to grow and prosper without DHL.” DHL currently accounts for about 74 pct of ABX Air revenues.
ABX Air had already been diversifying its customer base for several years and was well-positioned to place the B767 fleet with other customers on a wet-lease or dry-lease basis, Hete said. About half of the DHL-dedicated B767s could be placed with other customers, he added. Key customers include USPS, the US military and freight forwarder Schenker BAX.
CFO Quint Turner noted that ABX’s activities for DHL had been “low-margin business” and stressed that the company believed it could generate a higher return on capital from other customers. Although ABX has a ‘put’ option to return aircraft to DHL, the planes have a low book value, and higher prices might be achievable if the planes were sold on the open market, executives noted.
ATSG is also talking with DHL about severance packages for ABX pilots and aircraft mechanics.

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Union and state officials protest Deutsche Post plans to cut U.S. airlines ties

Posted by | Jul 1, 2008 | |

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.

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DHL urged to discuss terms with ABX and ASTAR (U.S)

Posted by | Jun 20, 2008 | |

Ohio legislators have called on DHL’s German-owned parent company to hold talks and discuss terms with ABX Air and ASTAR Air Cargo on the airlines’ proposals to remain DHL’s air carriers in the United States.
The June 16 letter, signed by both of Ohio’s U.S. senators plus eight Ohio members of Congress, presses Deutsche Post World Net (DPWN) in the final paragraph to give “genuine consideration” to proposals from current carriers ABX and ASTAR.
DPWN announced in late May it plans to contract with United Parcel Service (UPS) as the lone air carrier to transport DHL packages in North America. If the plan is carried out, it’s expected to directly cause the loss of at least 7,000 jobs at the Wilmington Air Park where ABX and ASTAR are based.
The focus of the letter to Jurgen Weber, Chairman of the Deutsche Post Supervisory Board, centers on what the legislators apparently view as a lack of interest or effort by DPWN to enter into the bargaining process with DHL’s existing air carriers.
Similarly, the letter’s first paragraph says, “… we ask that you allow incumbent carriers to present alternative proposals to DPWN before making a final decision.”
The letter concludes that the lawmakers would welcome an opportunity to help facilitate presentations of ABX’s and ASTAR’s proposals.
Referenced in the Ohio lawmakers’ letter is a possible direct loss of more than 8,000 jobs. The same sentence says there could be “an additional 30,000 downstream jobs” indirectly lost in southern Ohio.
The letter was released by U.S. Sen. Sherrod Brown’s office.

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Ohio urges DHL to reconsider UPS move

Posted by | Jun 17, 2008 | |

Ohio is asking the German owner of package delivery company DHL to reconsider a proposal that could mean the loss of at least 6,000 jobs at the DHL hub in southwest Ohio.

DHL wants to drop ABX Air and ASTAR as its air cargo handlers at the hub in Wilmington and replace them with Atlanta-based United Parcel Service. UPS would handle DHL packages at UPS’ existing hubs.

Ohio Lt. Gov. Lee Fisher says Frank Appel, chief executive of Deutsche Post World Net, told him Monday that he would be willing to explore other options, but made it clear that DHL intends to move forward with the UPS transaction.

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