Tag: USA

US regional express operator Velocity Express wins USD 30 million contract

Posted by | Jun 27, 2008 | |

Velocity Express announced this week that it has won a multi-year contract worth more than USD 30 million from specialty department store operator Stage Stores, Inc.

Under the agreement, Velocity Express will provide logistics services to Stage Stores’ Peebles brand stores throughout the Midwest, Northeast and Southeast. The services include daily store replenishment and vendor inbound transportation services to 310 Peebles stores, Velocity said.

Vincent Wasik, Velocity Express CEO, commented on the deal: “Our new agreement with Stage is confirmation that the top retailers recognise the value that Velocity brings to this business segment.”

Houston, Texas-based Stage Stores owns more than 715 stores throughout the United States. Under the “Peebles” name, it operates in the New England, Mid Atlantic, Southeastern and Midwestern states.

In the quarter ending December 29, 2007, Velocity Express generated revenues of USD 86.1 million, down from USD 102.3 million one year earlier, but reduced its operating loss to USD 3.9 million from the previous year’s USD 8.7 million.

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Mexican express market hit by weaker demand

Posted by | Jun 27, 2008 | |

The Mexican express market is starting to experience the impact of falling US demand and rising prices driven by higher fuel surcharges, according to a recent newspaper report. DHL is meanwhile pledging further investment in Argentina.

In Mexico, which has strong trade links with the USA, air cargo volumes dropped by 12.9 pct in the first quarter of 2008, the Reforma newspaper reported. Mexican airlines saw a 33.8 pct fall in their domestic volumes, although their international shipments rose by 18.4 pct, it said, citing figures from the Mexican civil aviation authority.

International airlines, including FedEx and UPS, suffered a combined 15.4 pct declines in volumes, it added. FedEx suffered a 73 pct decline in Mexico volumes while UPS had a 9.1 pct drop, according to official figures.

Customers started to switch business away from air transport rather than pay higher prices resulting from the rapid increase in fuel surcharges, the newspaper said. It cited UPS manager Miguel Trejo as saying that the situation was “stable” until now. But he added: “There are certain reductions in the growth expectations, however, and we are staying alert to market behaviour.”

In Argentina, in contrast, DHL Express has announced that it is maintaining its leadership of the international express market, with market shares of about 50 pct for express exports and 30 pct for imports.

Roger Crook, CEO DHL Express, International Americas, said on a recent visit to Buenos Aires that DHL would continue to invest in the market to offer customers the best possible service and a wide range of products. DHL Argentina has six operational centres linking the major cities, and operates with 90 vehicles, which it described as 30 pct more than the combined vehicle fleets of other international express operators.

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DHL begins ABX cutbacks

Posted by | Jun 27, 2008 | |

DHL notified ABX Air this week it will cut its use of the carrier’s DC-9 freighters by 23 aircraft starting next week, starting the DHL restructuring in the United States that will move the express operator’s volume over to UPS.

The cutback will reduce ABX revenue by approximately USD 3 million, the airline said. It is not yet known how many employees will be affected.

On May 27, DHL informed ABX Air that, starting in the third quarter, it intends, as a part of phase one of its cost-reduction programs, to remove from service over the next 12 to 18 months, 39 of 55 DC-9 aircraft that ABX Air has dedicated to DHL’s U.S. network.

“This reduction is in line with what we have planned for, and we are taking the steps necessary to accommodate these changes,” said Joe Hete, president and CEO of parent company Air Transport Services Group. Hete emphasized that his company will continue to perform under the current ACMI agreement and to pursue efforts to present DHL with a flexible plan to maintain a dedicated, efficient, and customized air network in the United States. The ACMI agreement with DHL includes a put provision that gives ABX Air the option to retain or to sell back to DHL the aircraft removed from the DHL network.

ABX has lately been aggressively expanding business with other customers. That effort will also continue, said Hete.

ABX Air has been DHL’s principal business partner in the United States since August 2003, when it became an independent publicly held company as its former parent, Airborne Express, was acquired by DHL.

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FedEx Trade Networks Opens New West Coast Gateways to Support Ocean-Ground Distribution Service

Posted by | Jun 25, 2008 | |

FedEx Trade Networks has opened two new gateways to support the FedEx Trade Networks Ocean-Ground Distribution service. The new West Coast gateways are located in Seattle, Wash., and Oakland, Calif., and will offer customers flexible options when shipping goods from Asia to multiple destinations in the U.S. The gateways will service the Seattle/Tacoma and Oakland/San Francisco ports.
FedEx Trade Networks Ocean-Ground Distribution is an alternative shipping method enabling customers to move cargo from Asia to multiple U.S. destinations in one seamless process. The innovative service combines FedEx Trade Networks ocean freight forwarding and customs brokerage services with the U.S. transportation and delivery services of FedEx Freight, FedEx National LTL, FedEx Ground, or FedEx Express. By managing the logistics, FedEx Trade Networks helps customers eliminate hand-offs and unnecessary steps to reduce cycle times and warehouse handling costs. FedEx Trade Networks Ocean-Ground Distribution customers benefit from the simplicity of working with one FedEx point of contact.
Seattle/Tacoma and Oakland/San Francisco will complement the existing Los Angeles and Chicago gateways and offer customers more options when importing from Asia, with three West Coast gateways.
FedEx Trade Networks operates offices and distribution centers in both the Seattle/Tacoma and Oakland /San Francisco locations with the capabilities to facilitate additional Ocean-Ground Distribution business.

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UPS shares at 4 1/2-year low after profit warning

Posted by | Jun 24, 2008 | |

United Parcel Service Inc shares fell 4.6 percent on Tuesday to their lowest point since late 2003.

UPS’s announcement came just a week after main rival Memphis-based FedEx Corp posted a quarterly loss and gave a weak profit outlook for its fiscal 2009.

The warning, which weighed on U.S. stocks, was the latest sign that corporate America could no longer brush off surging energy prices. Crude oil prices have roughly doubled over the past year.

UPS shares dropped USD 3.06 to USD 63.20.

The Dow Jones transportation index .DJT, which also includes airlines and railroads, was down 1.3 percent.

Like other major companies in the U.S. transport sector, UPS passes on higher fuel costs to customers. But as BB&T Capital Markets analyst John Barnes wrote in a note to clients, “fuel prices may have reached a tipping point at which many shippers are simply unwilling to pay the higher fuel surcharges.

Late Monday, UPS said it expected to earn between 83 cents and 88 cents per share in the second quarter, down from a previous range of 97 cents to USD 1.04.

In a statement, the company said U.S. package volume had been lower than expected, while demand for higher-priced air delivery services had seen a particular drop.

UPS also said that the “anemic U.S. economy is negatively impacting volume into the United States, affecting results for the international segment.”

In recent quarters, strong international package demand has helped both UPS and FedEx offset lower growth in their domestic services as U.S. economic growth has slowed.

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