If the tables were turned UPS/ASTAR(DHL Airways INC)

[erichartmann]

UPS could very well use a DHL contractor aircraft to fly it's volume in parts of the world where UPS currently uses airline belly space or common carriage. UPS will continue to fly what it does internationally and will continue to expand the airline internationally. I know that you can't stand to hear good news about another airline Dan, but it's the truth. UPS browntail jets flown around the world by IPA crews aren't going to go away no matter how hard you try and rationalize it.

So what are you going to do when DHL contracts aircraft to fly into SDF to put packages into the UPS sort? Or when UPS acts as DHL's contract broker and does the same. Don't worry, it's only DHL freight.

ACMI is coming. For everyone. It's only a matter of time.

 

[shooter]

Ahh!, but it IS all about me. It always has been. Once we meet my needs we'll think about yours for just a moment (and probably disregard them!)imp:

Funny. Would have me in stitches if Frank Appel and John Mullen didn't say the same exact thing. :nuts:

 

[eatme]

So what are you going to do when DHL contracts aircraft to fly into SDF to put packages into the UPS sort? Or when UPS acts as DHL's contract broker and does the same. Don't worry, it's only DHL freight.

ACMI is coming. For everyone. It's only a matter of time.

\
Just because you suck, doesn't mean everyone else has to.

 

[FO 4 Life]

I don't think, I KNOW, why UPS started an airline in '88...they were FORCED to by the FAA. Ask any of your old hands what and who brought them out of the Evergreen, Interstate, Orion, Rosenbalm, et al doldrums and into the UPS fold. Thank T. Allen McArtor for your brown ID badge, not UPS' "need for control"

http://en.wikipedia.org/wiki/T._Allen_McArtor

In the early '80's, Flying Tigers biggest commercial account was UPS. At that time, there was little concern by UPS over "control" other than to make sure the planes left and arrived on time. Had they not, I'm sure UPS would have sought another contractor.

How about this? Who's history is right?

[FONT=ARIAL, Helvetica, Geneva][FONT=ARIAL,][FONT=ARIAL,] In 1983 UPS bought 7 former Braniff 727-100's, and leased them to Orion airlines who then chartered them back to UPS on a multi year contract. (This was commonly done by freight and small package operators at the time and still widely used by DHL worldwide. Most of DHL's aircraft are subcontracted today.) UPS continued to buy used 727's, adding DC-8's purchased initially from Flying Tigers in 1983 and eventually signing multi year contracts with a total of 4 non-sked or "contract" carriers. Each of these carriers owned aircraft of their own which they occasioanlly leased long term to the freight forwarders or used them on Ad Hoc charters. The four carriers also operated aircraft under contract for Emery, Purolator, DHL, The US Postal Service, and Burlington Air Express, (now BAX Global, whos aircraft are now primarily operated by ATI, a wholly owned subsidiary of BAX).

Orion International Airlines came on board in 1983, Evergreen International Airlines, and Interstate Airlines (now ATI, Air Transport International), came on board in 1984, and finally Ryan International Airlines in 1985. Each airline operated a fairly evenly split number of the 727's. Orion won the contract in 1984 for the initial 6-747-100's purchased from American Airlines. Evergreen and Orion operated the DC-8-73's while Interstate won the contracts to operate the initial 10 DC-8-71's purchased in addition to the 13 DC-8's purchased from Delta. Ryan, the last carrier to come aboard, won the contracts to operate the 8 727-200's and the inital 10 757's.

Ocasionally various tail numbers where shifted between carriers. All of the required routes were divided between the carriers and each one had a mix of short and longer haul routes.

In 1986, Ronald Reagan negotaited the initial landing slots in Narita for an American small parcel carrier. Fedex, and Orion applied for the slots. UPS was legally only a freight forwarder at the time as all of the aircraft were leased and chartered back. They wanted to apply for the slots but didn't feel there was enough business at that time to support a single dedicated DC-8 every day to Japan. It sounds funny now with the huge fleets of widebody freighters crossing the Pacific and Atlantic oceans as well as muliple around the world freighter flights by each carrier but in 1986 UPS only operated to the 48 states, Hawaii, and San Juan. The first scheduled transatlantic flight, to be operated by a UPS/Evergreen DC-8 from Newark to Cologne (West) Germany would not begin for another year. The carriers were flying UPS aircraft on regular charters to europe and asia but there was no UPS small package infastructure in most other countries back then.

UPS partnered with DHL and formed a 50/50 partnersip in a company called International Parcel Express. IPX ,as it was called for short, was the third carrier to apply for the American small package carrier slots to Narita.

IPX hired a group of former Transamerica people from that recently defunct company to gain the air carrier certificate and UPS leased 2 DC-8's....N880UP, and N819UP to the new company. Those were the last two DC-8's to have the CFM conversion done and were initially tagged to go to Orion Airlines. The fledgeling airline hired 24 pilots and flew SDF-BDL and SDF-DFW for UPS.

During the court proceedings, Fedex pointed out that IPX was 50% owned by DHL, which is not a US company and that to be eliegible for the slots the airline has to be 75% owned in the USA. UPS quickly bought an additional 25% share from DHL but it was too late. The judge awarded the Narita slots to Fedex with IPX being the default carrier should Fedex not use them.

By now it was mid 1987. The UPS fleet had grown to roughly 60 aircraft. In their initail studies in 1982, UPS had estimated there might be a market to support up to 40 freighters by the year 2000. It was becoming difficult to manage with so many different contract carriers and aircraft so on September 13, 1987 UPS announced it would be taking over all air operations in 1988 and using the IPX certificate as the basis for UPS airlines. The takeover details in 1988 would fill a book so I won't even try to explain them here.
[/FONT][/FONT][/FONT]

 

[eatme]

Yawn, did someone say somethin'

 

[Whistlin' Dan]

How about this? Who's history is right?

That's a pretty accurate account of the events leading to the formation of UPS' airline. I'd be interested in knowing the source. What if doesn't explain, however, is why UPS employed multiple carriers to fly similar aircraft types. Any difficulties they had "managing so many contract carriers" were surely compounded by the fact that each type of aircraft was being operated by as many as 4 different contractors. Any of the contractors operating UPS' 727's, for axample, would have gladly taken over responsibility for that entire fleet. Doing so would have greatly eased the burden of managing those operations. However, "gaining control" of their 727 fleet would have left UPS reliant upon a single carrier for that fleet. I think their decision to spread responsibility for that fleet among several carriers was so they couldn't be held hostage to a single labor group, as they are now.

The same could be said for the DC-8. I believe there were 3 contractors operating them (your source doesn't mention Rosenbalm). I don't remember how many airframes they had (12? 20?) but they certainly didn't need 3 certificate holders (with 3 different management teams, 3 different ops specs, 3 different maintenance organizations and spares supplies, etc) to run them. Again, this was a matter of choice, not chance.

One thing that nobody's brought up in this discussion so far are the feeders, UPS' "mosquito fleet." If running their own airline was a way to exert door-to-door control over every aspect of their operation, why haven't they brought them in-house as well? What good does it do to fly a box to a hub in a 100 million dollar airplane, only to send it the last 100 miles in a ratty Navajo flown by a low-time pilot? If UPS can buy delivery trucks and hire drivers, I'm certain they could get a bulk discount on Cessna Caravans and find a lot of highly motivated pilots to fly them. Why haven't they?

Until I see a refutation by someone in the FAA, I'll stand by my assertion that it was them, and not UPS management, that pushed Air Carrier status upon UPS.

 

[eatme]

That's a pretty accurate account of the events leading to the formation of UPS' airline. I'd be interested in knowing the source. What if doesn't explain, however, is why UPS employed multiple carriers to fly similar aircraft types. Any difficulties they had "managing so many contract carriers" were surely compounded by the fact that each type of aircraft was being operated by as many as 4 different contractors. Any of the contractors operating UPS' 727's, for axample, would have gladly taken over responsibility for that entire fleet. Doing so would have greatly eased the burden of managing those operations. However, "gaining control" of their 727 fleet would have left UPS reliant upon a single carrier for that fleet. I think their decision to spread responsibility for that fleet among several carriers was so they couldn't be held hostage to a single labor group, as they are now.

The same could be said for the DC-8. I believe there were 3 contractors operating them (your source doesn't mention Rosenbalm). I don't remember how many airframes they had (12? 20?) but they certainly didn't need 3 certificate holders (with 3 different management teams, 3 different ops specs, 3 different maintenance organizations and spares supplies, etc) to run them. Again, this was a matter of choice, not chance.

One thing that nobody's brought up in this discussion so far are the feeders, UPS' "mosquito fleet." If running their own airline was a way to exert door-to-door control over every aspect of their operation, why haven't they brought them in-house as well? What good does it do to fly a box to a hub in a 100 million dollar airplane, only to send it the last 100 miles in a ratty Navajo flown by a low-time pilot? If UPS can buy delivery trucks and hire drivers, I'm certain they could get a bulk discount on Cessna Caravans and find a lot of highly motivated pilots to fly them. Why haven't they?

Until I see a refutation by someone in the FAA, I'll stand by my assertion that it was them, and not UPS management, that pushed Air Carrier status upon UPS.

You are still done

 

[AV80R]

... Until I see a refutation by someone in the FAA, I'll stand by my assertion that it was them, and not UPS management, that pushed Air Carrier status upon UPS.

I heard the same from several 'original' UPS guys and also from a fairly senior manager who all said that UPS fought the FAA on this and did not want an airline of their own...

 

[Whistlin' Dan]

You are still done

And you're not???


BTW...was that DB I saw hangin' 'round the other day? Lookin' pretty dapper, I'd say! 'Course, that's what a half-mil in back pay will get ya...

 

[eatme]

Dan, you're forked..get over it

 

[rotor&wing]

The deal that provoked UPS to use the IPX certificate and begin their own airline was a couple of the operators running the 727 programs were not having proper maintenance done on the aircraft. UPS owned the airplanes and as part of the ACMI they would pay to comply with SB's and AD's. Seems a couple of the operators were putting the money in their pockets and not complying. In comes the FAA and finds this out, then the FAA demands UPS get control over these operations.

 

[erichartmann]

\
Just because you suck, doesn't mean everyone else has to.

Wake up and smell the roses Richard. Listen to what Allen and Mullen have said about code sharing. Take a good long look at the marine transportatin industry and how DHL (and others) use it. Then think about who crews those ships and where they are flagged.