Thinking out loud on DHL and asking a few QQ's

[DC8CRIVER]

I believe that * IF * this turns out to be DHL's plan, they would go back to the business model that they used prior to 2002. Back then they flew to large cities only and relied on USPS, road links, and pax belly space to fill in some of the other areas. At no time did they have complete coverage to all US zip codes.

8

 

[Publishers]

What you might be missing is that the international business is not an overnight business. This is from a company that started being a courier which used to solicit passengers on international flights to take their packages as luggage.
They can put this stuff in many different modes and meet the delivery though contractors.
The big differences between all of the mentioned companies is on the ground, not in the air. UPS is one of the largest users of rail as an example.;

 

[Whistlin' Dan]

Latest rumours from this side of the pond is that the DHL/UPS deal is dead, with DHL to retreat back to CVG, dump ABX and have the flying done by ASTAR only. Further to that, ASTAR to re-fleet with 757 and 767-200SF's, aiming for a fleet around +/- 40 aircraft, serving the North American (incl. Canada) and Central American (as far south as PTY) markets only.

That sounds like a GREAT plan! If they'd come up with it in 1998, it might have been up and running by 2002 and they wouldn't be in all this trouble now.

 

[shooter]

What you might be missing is that the international business is not an overnight business. This is from a company that started being a courier which used to solicit passengers on international flights to take their packages as luggage.
They can put this stuff in many different modes and meet the delivery though contractors.
The big differences between all of the mentioned companies is on the ground, not in the air. UPS is one of the largest users of rail as an example.;

True. When you look at the model being proposed in the rumor, and look at the current loads with domestic packages still in them with the international what do you make out of it?

 

[MACHTRANSDUCER]

new delivery method?

actually, the refleet is all c-130's, slide the containers out via parachute, eliminates ground crews, apu's etc, all the containers are fitted with a gps locating marker, err, it is the germans, they are using NDB's for tracking........

 

[Publishers]

I jsut see a continual decline in domestic shipments with their focus on cities that have large international shipping prospects that can be handled in belly freight or on international FEDEX or UPS flights.
Beer Belly was talking about density but that is more important in regular air freight than package delivery. The yield off the packages is so much higher and density so much less, it is a different equation. In your time delivered product, you have to have more delivery capability to make the guarantees.
Look at it this way, a half filled FEDEX airplane generates much more in revenue than a totally filled air freight aircraft. On the other hand, more of that revenue is going to be spent on delivery than the air freight product.

 

[shooter]

I jsut see a continual decline in domestic shipments with their focus on cities that have large international shipping prospects that can be handled in belly freight or on international FEDEX or UPS flights.
Beer Belly was talking about density but that is more important in regular air freight than package delivery. The yield off the packages is so much higher and density so much less, it is a different equation. In your time delivered product, you have to have more delivery capability to make the guarantees.
Look at it this way, a half filled FEDEX airplane generates much more in revenue than a totally filled air freight aircraft. On the other hand, more of that revenue is going to be spent on delivery than the air freight product.

While there is a continual decline in domestic shipments, would most of those be due to the economy or lost customers for DHL? DHL is losing customers at grand scale because their product is not offering the service the customer requires. DHL's answer? To reduce their product even more which results in more lost customers. Even if the customer has a reduction of 30% in shipping because of the economy, DHL is losing 100% of the freight because they cant offer what the customer wants. Just my opinion, of course, but I see DHL reacting to a slumping economy by removing themselves from the picture. They can try and blame fuel, the economy, multiple airlines, ICC's but it is all them and their actions. Just my opinion.

 

[Whistlin' Dan]

I just got this from a source I generally consider relaible. Even if every word of it is true, DHL/Astar is still beset with problems as the transition will surely cost them even more customers. In short, it raises more questions than it answers. I'm passing it along for entertainment value only;

"After DHL let go 90% of its sales force last week, it has informed its National Accounts they should seek other domestic shipping options.

*DHL plans on letting the remainder of their ground network (2day/GDS etc) die with the expected loss of revenue with their recent announcement to their National Accounts.

*DHL is planning on shutting down the night sort at Wilmington on Nov 29, 2008. They have informed commerce park (the business park located next to the Wilmington hub) clients of this.

The DHL/UPS deal is reportedly dead. The two could not come to terms on a number of issues. DHL is supposedly using it as a smokescreen to insure their existing customers are serviced and have time to react to the recent announcement to seek other shipping options.

*DHL is making arrangements to move their overnight (P1) and international shipments to the old DHL Hub at Cincinnati (CVG). Reportedly sorters are being hired and electricians are on site at the to begin operations after the November 29 shutdown of the Wilmington night sort.

*Astar is reportedly providing the necessary lift for the DHL/CVG hub operation.

*There is no intention on DHL's part to 1) contract with UPS 2) maintain overnight sort operations into 2009 as claimed, or the day sort much into 2009. DHL's goal is to eliminate the ground service (P2,etc.)as quickly as possible in order to eliminate the expense of maintaining their regional hub network (ie, Allentown/ABH).

*Wilmington sort volume has dropped significantly since the DHL/UPS announcement was made in May.

*Unishippers is supposedly to begin selling UPS (they are a reseller of DHL service)

*DHL’s reported strategy is to keep quiet until the last possible moment so as to not inflict service issues upon their existing accounts by upsetting the Wilmington work force further."

 

[Bob Dylan]

I just got this from a source I generally consider relaible.

I'm not sure I would consider exdhl.com reliable.

http://exdhl.com/forums/index.php?showtopic=3628&view=findpost&p=38952

 

[rotor&wing]

Dunno Bob, but this is fact, not rumor:

All Nippon, UPS Forge International Cargo Deal, Nikkei Says

By Joi Preciphs

Oct. 30 (Bloomberg) -- All Nippon Airways Co. and United Parcel Service Inc. agreed to handle each other's international shipments to help better position each company economically, Nikkei English News reported, without citing anyone.

The agreement will help the firms focus on major markets, cut back cargo flights and increase usage rates for their aircraft, the news service said. UPS is also looking to increase orders from Japanese automakers and electronics producers.

All Nippon is expected to handle UPS shipments en route for China, South Korea and Thailand, Nikkei said. UPS will represent its partner on U.S., European and Philippine routes.

To contact the reporter on this story: Joi Preciphs in Washington at [email protected].
Last Updated: October 29, 2008 15:27 EDT

 

[Whistlin' Dan]

I'm not sure I would consider exdhl.com reliable.

http://exdhl.com/forums/index.php?showtopic=3628&view=findpost&p=38952

I didn't get it from exdhl.com. In fact, if you'll compare the time it was posted there (6:00 P.M.) to the time I posted it here (17:02), it appears quite possible that that individual lifted it from this site.

My source has access to standard industry "hotsheets" and some inside information, but no interest in either of these boards or to the operational side of the business.

 

[flyinboxes]

Ouch, wonder how that affects UPS scope or do they have any intra-asia scope? You should know Bob Dylan.

 

[hvydriver]

I"]http://exdhl.com/forums/index.php?showtopic=3628&view=findpost&p=38952[/url]

I didn't get it from exdhl.com. In fact, if you'll compare the time it was posted there (6:00 P.M.) to the time I posted it here (17:02), it appears quite possible that that individual lifted it from this site.

My source has access to standard industry "hotsheets" and some inside information, but no interest in either of these boards or to the operational side of the business.[/quote]

Actually, it shows ABXspeedyboys posted that at 5:00 pm on ex-dhl, and you posted it at 17:02 here. (17-12=5pm) 2 minutes after it was posted there.

 

[Publishers]

It has been awhile but UPS does not have the rights that FEDEX has because FEDEX got them through the purchase of Tigers.

 

[shooter]

I have seen 3 job postings for Astar just this week. I don't know why they are posting them on an industry job board rather than their own web-site. I sure hope the HR folks are not trying to be sly by posting them there as to not warrant suspicion.