Hub plan, this worries me a bit...

[ABXbooger]

The Dayton-Montgomery County (Ohio) Port Authority is creating $300 million in financing (in the form of tax-exempt bonds) to consolidate DHL?s hub operations, following the integrator?s decision to move its Cincinnati operations to Wilmington, where ABX AIR operates the former Airborne hub for DHL. The upgrade to the Wilmington hub will include a million-square-foot, two-story sortation facility. The consolidation will not bring any dramatic increase in flights at Wilmington, as DHL will replace much of the ABX DC-9F flying with 767-200Fs as well as 727Fs from the ASTAR AIR CARGO fleet. (Source: Cargo Facts Update. Sept. 23, 2004.) See attachment for separate reports from the Dayton and Cincinnati newspapers.


I don't really see how they are going to replace the 9's with 767's and I can't see them buying more 727's for Astar...I don't buy much into what these reporters say, but it does make me think. I do hope they plan to replace the 9's with 767's, that would be great!

 

[UPSer]

One of my contacts at ABX, who is a flight manager, has said that DHL told ABX to expect a reduction in the fleet once the consolidation is started in earnest.

I also heard a rumor that Kitty Hawk is interested in bidding for some DHL work, wonder if Clifton leaving to be their VP of flight ops has anything to do with that?

 

[AV8OR]

I'm sure they are, and they may get some, but, it would be a violation of the ACMI with AStar owners if they don't have first crack at it.


We'll see. I think we all know how reliable the word of DHL is.

 

[goastar]

First crack at the bid only. Who do you think would have the lower bid? Hmm, lets see, I will have to get back to you on that. Face the facts man, we don't, nor does ABX for that matter, stand a chance for NEW routes against Kitty or Capitol. But we can always hope.

 

[Airbus300]

I agree with GOASTAR. We get first crack at the bid only... which doesn't mean much because in a bidding situation, the lowest bidder wins...not always the first bidder. I printed off a copy of that section of the ACMI agreement and put it somewhere. It did not make me feel like Astar had any advantage getting new routes whatsoever... but as some Airborne guys have suggested, hopefully they will grow us both, instead of finding new carriers.

 

[freightdawgs]

The Dayton-Montgomery County (Ohio) Port Authority is creating $300 million in financing (in the form of tax-exempt bonds) to consolidate DHL?s hub operations, following the integrator?s decision to move its Cincinnati operations to Wilmington, where ABX AIR operates the former Airborne hub for DHL. The upgrade to the Wilmington hub will include a million-square-foot, two-story sortation facility. The consolidation will not bring any dramatic increase in flights at Wilmington, as DHL will replace much of the ABX DC-9F flying with 767-200Fs as well as 727Fs from the ASTAR AIR CARGO fleet. (Source: Cargo Facts Update. Sept. 23, 2004.) See attachment for separate reports from the Dayton and Cincinnati newspapers.


I don't really see how they are going to replace the 9's with 767's and I can't see them buying more 727's for Astar...I don't buy much into what these reporters say, but it does make me think. I do hope they plan to replace the 9's with 767's, that would be great!

I can't find a source for this story.
Please provide a link.

 

[iaflyer]

I could see a situation develop where Capital or Kitty Hawk could bid on the flying, and DHL could use the bid to force ABX into lower prices.

This happened over at USA Jet a year or two ago - Ameristar and USA Jet (and many others) would bid on the same Active Aero trips. USA Jet had the right to bid last, so they could match the Ameristar price if they wanted and get the trip. However, sometimes Ameristar would bid so low that it was uneconomical to match - trip goes to Ameristar. Effectively, Ameristar was dictating how much USA Jet could charge when business was slow.

DNL could also use the threat of using other carriers instead of ABX to force long term price cuts from ABX. Similar to the Comair/ASA/CHQ situation over in the Regional forum.

iaflyer

 

[ABXbooger]

I don't really think DHL will go to other ACMI carriers to replace ABX or Astar. If that was going to be a viable option, why hasn't Fedex or UPS gone that route? I have also heard that most ACMI carriers out there cannot begin to approach the on-time or dependability requirments that DHL must have to be competitive in this game. ABX and Astar have been at this a while, why cut yourself off at the knees? Our on time numbers are somewhere around the 95% area, usually closer to 97%.

 

[freightdawgs]

For what its worth, I think it might be a worry also.In recent anouncments dhl has stated that it is putting together truck(sort) hubs that will offer next day ground service throughout the U.S.,this will help pull a lot of freight off of iln and allow freight to be trucked to distances one day away from each sort center,so priority freight does'nt have to fly to iln to get delivered the next day if its inside the region.

 

[AV8OR]

Freightdawgs,


I agree. If anybody has looked at an Air Cargo World in the last two years, you can see that trucking in the "air" freight world is a big coming factor in how this business is run and the outlook for our part in it.

Also, like someone else said, I think DHL will shoot themselves in the foot if they think that the standard ACMI group will be able to match our performance at AStar and ABX. It's not that others couldn't, but it might be a steep learnig curve. Whether DHL wants to gamble the over 2 Billion in expansion money they are spending here on that type of unknown, we'll see.