DHL failed. Return of Airborne ILN only option?

[shooter]

Shooter, let me ask you a question. Let's say that this deal took another turn in another time and place. Let's say everything is the same with reguards to the change in vendor(not merger as you see it). Let's now say UPS and DHL agree to keep all 8000 employees at Wilmington with same pay and benefits. Do you think anyone would care?

Now you have your opinions, which I respect. But I have other, I believe more educated opinions which lead me to believe otherwise. I have said it before and will say it again, that if it were not for the terrible loss of jobs, this would be like a fart in the wind. The politicians are doing what they do, which is to protect their district. They can call it anti-trust, you can call it anti-trust, but at the end of the day, it is nothing more than an attempt to save jobs.

And no the DOJ cannot stop a change in vendor, even if it is with a competitor. Actually DHL could claim that not going forward with the UPS deal could lead to even less competition.

The bottom line is that someone is going to have to prove that this deal is going to be bad for the consumer. When you threaten to pull out of the US market and leave 2 companies to choose from, well, that ain't good for the consumer.

A change in vendor would be to use World or Amerijet. Using UPS is using your competitor. I would expect your "more educated opinions" would understand who is a competitor and who is not. Not that I am judging your "more educated opinion". I understand it takes much more know how to read the misspelled labeling in the Brazilia. :laugh: just kidding.

I do not know if the DOJ will kill this deal due to anti-trust any more than you know they will not. I admit that, you seem to think you are above it. But from what I have read and understand, there is very strong case that it will be heard by the DOJ and has a very strong chance to be stopped as a result. If your "more educated opinions" can show me different, I am willing to listen.

EDIT:

When you threaten to pull out of the US market and leave 2 companies to choose from, well, that ain't good for the consumer.

You do NOT turn your back on US law due to threats, and the end result would be the same; 2 air options, which you just said "ain't good for the consumer".

 

[EMBPILOT1]

Father retired attorney
Uncle attorney
Uncle retired Federal judge in the great state of Ohio

I think I will will respect what they say more than anything I read on FI.

your lawyers always say you have a great case when they are taking your money. Your always gonna win too. I would rather listen to someone who does not have a dog in the race. :beer:

 

[Big Beer Belly]

I have said it before and will say it again, that if it were not for the terrible loss of jobs, this would be like a fart in the wind. The politicians are doing what they do, which is to protect their district. They can call it anti-trust, you can call it anti-trust, but at the end of the day, it is nothing more than an attempt to save jobs.

And no the DOJ cannot stop a change in vendor, even if it is with a competitor.

I agree completely. In my admittedly lay perspective I see no anti-trust issue. DHL will continue to offer its services after the UPS deal just as they do now. A change in vendors does not reduce or eliminate competition and will be largely transparent to DHL customers. I see no anti-trust issue with a simple change in vendors.

Beyond what's stated above, all I've read is a LOT of what if's, what might be's, this must be what they're planning, hyperbole and innuendo, conspiracy theories, idle ramblings, etc... The facts are DHL expanded their presence in the US domestic market through acquisitions of existing companies and through poor management, poor execution and very tough embedded competition they find themselves in a situation of accelerating losses. They chose to switch US vendors and radically overhaul plans for a substantial domestic presence in the US beyond what is minimally required to service their international product.

By choosing this course of action, they fix and dramatically reduce their future capital outlays as there is no need to upgrade/expand sort facilities, increase workers, modernize aircraft fleets, etc... If their market share is reduced in the US then so is their bill to UPS, unlike their current arrangement of large fixed costs.

They can even argue it is more environmentally friendly to "capacity share" and not fly around a bunch of half-empty fossil fuel burning, greenhouse gas emitting, climate changing evil machines!


BBB

 

[fob727]

Norm, you're back!

We haven't had anybody spew BS here for a while. I guess you didn't get asked to the hearing today.
Maybe we'll see you and hear more nonsense next month in D.C.

If it doesn't agree with your opinion, it's hyperbole, innuendo, and idle ramblings.

A$$hole!

 

[Big Beer Belly]

Norm, you're back!

We haven't had anybody spew BS here for a while. I guess you didn't get asked to the hearing today.
Maybe we'll see you and hear more nonsense next month in D.C.

If it doesn't agree with your opinion, it's hyperbole, innuendo, and idle ramblings.

A$$hole!

fob... your incessant whining, keen intellect and vocabulary is predictable... brings a smile to my face.

BBB

 

[fob727]

BBB, I'm overjoyed that something other than the demise of over 1,000 of your fellow aviators(if you are even a pilot) and 9000 others puts a smile on your face. You can post your BS about "entitlement" here and on other boards, use your "extensive vocabulary", but it doesn't change the fact that you are an A$$hole!

 

[Publishers]

Three are some keys to any anti trust action:

• prohibiting agreements or practices that restrict free trading and competition between business entities. This includes in particular the repression of cartels.
• banning abusive behaviour by a firm dominating a market, or anti-competitive practices that tend to lead to such a dominant position. Practices controlled in this way may include predatory pricing, tying, price gouging, refusal to deal, and many others.
• supervising the mergers and acquisitions of large corporations, including some joint ventures. Transactions that are considered to threaten the competitive process can be prohibited altogether, or approved subject to "remedies" such as an obligation to divest part of the merged business or to offer licences or access to facilities to enable other businesses to continue competing.

The substance and practice of competition law vary from jurisdiction to jurisdiction. Protecting the interests of consumers (consumer welfare) and ensuring that entrepreneurs have an opportunity to compete in the market economy are often treated as important objectives. Competition law is closely connected with law on deregulation of access to markets, state aids and subsidies, the privatisation of state owned assets and the establishment of independent sector regulators

1. Did the action lead to there being less competitiors in the market?
2. Is the public hurt by this action?
3. This is not a joint venture or a merger.

In fact, it could easily be argued that not allowing this would decrease the competition if DHL left. Secondly, they could leave and hire UPS or someone else to do the international deliveryl, even someone like American. The only question then would be are they going to have their own p&d. There is no law that can compel them to continue.

 

[fob727]

DHL will never leave the US on it's own. Too much of its Int'l business is here.

 

[shooter]

Three are some keys to any anti trust action:

• prohibiting agreements or practices that restrict free trading and competition between business entities. This includes in particular the repression of cartels.
• banning abusive behaviour by a firm dominating a market, or anti-competitive practices that tend to lead to such a dominant position. Practices controlled in this way may include predatory pricing, tying, price gouging, refusal to deal, and many others.
• supervising the mergers and acquisitions of large corporations, including some joint ventures. Transactions that are considered to threaten the competitive process can be prohibited altogether, or approved subject to "remedies" such as an obligation to divest part of the merged business or to offer licences or access to facilities to enable other businesses to continue competing.

The substance and practice of competition law vary from jurisdiction to jurisdiction. Protecting the interests of consumers (consumer welfare) and ensuring that entrepreneurs have an opportunity to compete in the market economy are often treated as important objectives. Competition law is closely connected with law on deregulation of access to markets, state aids and subsidies, the privatisation of state owned assets and the establishment of independent sector regulators

1. Did the action lead to there being less competitiors in the market?
2. Is the public hurt by this action?
3. This is not a joint venture or a merger.

In fact, it could easily be argued that not allowing this would decrease the competition if DHL left. Secondly, they could leave and hire UPS or someone else to do the international deliveryl, even someone like American. The only question then would be are they going to have their own p&d. There is no law that can compel them to continue.

Aahhh, a Wikihead. Lets see what Wiki says about our Sherman Act.

The Sherman Antitrust Act (Sherman Act[1], July 2, 1890, ch. 647, 26 Stat. 209, 15 U.S.C. § 1–7) was the first United States Federal statute to limit cartels and monopolies. It falls under antitrust law.
The Act provides: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal".

The purpose of the act was to oppose the combination of entities that could potentially harm competition, such as monopolies or cartels.

The way I see it, if you combine the air service of two competitors under only one of the air networks you have eliminated competition for that service. So, yes to question number 1, there are less competitors in the market. And as a result for question number 2, air network service and schedule will be dictated by UPS and that not only eliminates consumer choice but their price as well. And for question number 3, a rose by any other name....... Call it what you want and it does not change what it really is.

If DHL pulls out of the market is not an argument you can make. The act also states "The Sherman Act was not specifically intended to prevent the dominance of an industry by a specific company. any company that "got the whole business because nobody could do it as well as he could" would not be in violation of the act. The law attempts to prevent the artificial raising of prices by restriction of trade or supply. [8] In other words, innocent monopoly, or monopoly achieved solely by merit, is perfectly legal, but acts by a monopolist to artificially preserve his status, or nefarious dealings to create a monopoly, are not."

So UPS can freely dominate the market with FedEx and that is fine. If DHL concedes it cannot compete against UPS and FedEx then you two have legal right to the entire market.

You guys over at UPS have a good product. I like it and prefer to use it rather than FedEx. If you kill off DHL due to your own service and product, good for you.

Again, I am not a lawyer (thank god). But the more I look and listen to people better versed in this law I can see how there is a strong case to stop this deal. And being an Airborne Express guy that has seen my future destroyed by DHL, I welcome the resistance.

 

[Big Beer Belly]

The way I see it, if you combine the air service of two competitors under only one of the air networks you have eliminated competition for that service. So, yes to question number 1, there are less competitors in the market. And as a result for question number 2, air network service and schedule will be dictated by UPS and that not only eliminates consumer choice but their price as well. And for question number 3, a rose by any other name....... Call it what you want and it does not change what it really is.

Shooter...

Any anti-trust review will look at DHL today and after the switch of vendors. A switch in vendors will have zero impact on a consumer's choice in shipping services. 2 years from now they'll still be able to ship a package using DHL. There will be zero loss of competition in the marketplace; there is no anti-trust case.

Furthermore, since this is not a merger and no loss of competition in the marketplace will result, UPS and DHL intend to argue the DOJ does not even have jurisdiction (over vendor choices.)

BBB

 

[shooter]

Shooter...

Any anti-trust review will look at DHL today and after the switch of vendors. A switch in vendors will have zero impact on a consumer's choice in shipping services. 2 years from now they'll still be able to ship a package using DHL. There will be zero loss of competition in the marketplace; there is no anti-trust case.

Furthermore, since this is not a merger and no loss of competition in the marketplace will result, UPS and DHL intend to argue the DOJ does not even have jurisdiction (over vendor choices.)

BBB

I would respectfully disagree based on how I read the anti-trust laws. On the surface you may see yellow and brown boxes, but the pricing and service locations and times for air service are dictated by one sole carrier in this scenario and that is where I see the anti-competitive problems. But you may be right, we shall see.

 

[Publishers]

In addition to the above, you are also forgetting USPS product and other shipping products that exist that are competitive.
For anti trust to be in effect, DHL would have to be the complaintant saying they were forced out by UPS/FEDEX who have a cartel/monopoly on the market. Not the case here. Shooter and Big have it right.

 

[shooter]

In addition to the above, you are also forgetting USPS product and other shipping products that exist that are competitive.
For anti trust to be in effect, DHL would have to be the complaintant saying they were forced out by UPS/FEDEX who have a cartel/monopoly on the market. Not the case here. Shooter and Big have it right.

I do not agree with BBB, Publishers.

I understand that your argument says there are choices to use DHL, UPS, FedEx and USPS and you would be right. But pick any of the four shippers and you have only two ways to ship the express product after the deal and that would be UPS or FedEx. I do not understand how that is hard to see as a problem for consumers for some on this board. Or how they can't tell me why they do not see it as a problem. Even if I were not directly affected I am sure I would see the anti-competitive problems that creates.

EDIT: And for DHL to be driven out of business due to a superior product by UPS or FedEx would be the way for it to not be an anti-trust problem. Free market that results in one or two competitors is fine and legal. The collusion of two players to reduce the market or raise prices are against anti-trust laws and illegal. That is what I think is going on here.

 

[Big Beer Belly]

I

I understand that your argument says there are choices to use DHL, UPS, FedEx and USPS and you would be right. But pick any of the four shippers and you have only two ways to ship the express product after the deal and that would be UPS or FedEx.

Shooter...

I (we) see your point. I simply don't think it's a big deal based upon other industries and their similar reliance on "shared infrastructure".

My info about the telecom industry is (admittedly) dated, but I'm certain there are other industries (unknown to me) with similar large infrastructure arrangements. 10-20 years ago there were over 200 separate companies selling phone service in the US. AT&T dominated the copper wire infrastructure but sold access to their infrastructure to other "competing" telecom providers, who in turn re-sold it to businesses and consumers (similar to DHL selling their delivery service but utilizing the UPS network.) AT&T and Sprint would routinely "share" access to each others' networks in agreed upon locations to economize on building duplicating infrastructures (mostly fiber optic) in locations with light traffic and/or remote locations.

The point is that although the consumer had several hundred choices in telecom providers all the bandwidth was owned by just a few. You would argue this was clearly a problem and I would retort that it wasn't (with the correct oversight.)

I understand the shipping, transportation, electrical power generation/distribution industries are all big infrastructure sharing industries also.

BBB

 

[shooter]

Shooter...

I (we) see your point. I simply don't think it's a big deal based upon other industries and their similar reliance on "shared infrastructure".

My info about the telecom industry is (admittedly) dated, but I'm certain there are other industries (unknown to me) with similar large infrastructure arrangements. 10-20 years ago there were over 200 separate companies selling phone service in the US. AT&T dominated the copper wire infrastructure but sold access to their infrastructure to other "competing" telecom providers, who in turn re-sold it to businesses and consumers (similar to DHL selling their delivery service but utilizing the UPS network.) AT&T and Sprint would routinely "share" access to each others' networks in agreed upon locations to economize on building duplicating infrastructures (mostly fiber optic) in locations with light traffic and/or remote locations.

The point is that although the consumer had several hundred choices in telecom providers all the bandwidth was owned by just a few. You would argue this was clearly a problem and I would retort that it wasn't (with the correct oversight.)

I understand the shipping, transportation, electrical power generation/distribution industries are all big infrastructure sharing industries also.

BBB

Well I hope that does not happen in this case. Not for just the obvious reasons you hear me voice, but with a situation like this (in comparison to your example) and if allowed to go through just may tie your hands as a labor group. If you find yourself at heads with management and that "oversight" does not allow you to exercise your rights as labor you may be...well...for a lack of a better word, trapped. The concerns in this deal for consumers would be the same that removes your best weapon as a labor group. This could get MUCH more deeper on the Hill than what I was just thinking.

Any word on your end as to the signing of the contract? The DOJ will not even start an investigation (if they do) until something is on paper.