Air Cargo News

Fed/UPS At The Throat Of DHL

     It’s the most exciting story in air cargo right now.
     No, it’s not the surprising strength in the Euro, that has turned revenue from outbound U.S. freight a player once again.
     After two years of truly rotten business, that development is certainly welcome.
     Of course when it comes to shell-shocked U.S. cargo, the unknown factor is how soon air cargo people in the lower 48 will figure out which end is up and from what direction money can be made and ramp-up the business.
     But now with an outcome, subject to a judge’s decision later this fall, the hot stuff story to just sit back and be amazed at, is the full blitz campaign by FedEx and UPS—a gang-up really, to halt DHL’s bid to buy Airborne Express.
     Both U.S. integrator giants are apoplectic at the prospect that DHL, the international small package giant, will gain a significant foothold in America.
     The Fed/UPS should be.
     DHL does more business in high-yield express cargo around the world than both FedEx and UPS combined.
     Put another way, globally, DHL hands both U.S. integrators their collective heads wherever and whenever they compete.
     In the Memphis and Atlanta board rooms, DHL with 15,000 Airborne trucks on the ground across the U.S., driving down prospects for FedEx and UPS on main street America, is a must to avoid.
     Don’t blame either UPS or FedEx for screaming bloody murder.
     Monopolies die hard.
     Also don’t feel bad for either or both of them if the U.S. Department of Transportation allows DHL into the ground delivery business here either.
     In America, the Fed/UPS controls the market.
     In fact, both have as near as it gets, an excuse to print their own money.
     Last week, one of the beefs made by the Fed/UPS against the deal was probably taken out, now that former Northwest Airlines chief executive John Dasburg, will buy DHL from Deutsche Post and investor William Robinson for $57 million.
     FedEx and UPS had been running around saying that Robinson is little more than a shill for Deutsche Post.
     That seems unkind, even unfair, but at the very least a stupid and uninformed label to pin on the guy.
     So let’s set the record straight. Here’s to you Mr. Robinson, a full-blooded U.S. citizen who has been connected to the DHL organization for over 30 years.
     By our count, 30 years is a lifetime, and maybe longer than the Fed/UPS have even been in the air cargo business, for crying out loud.
     Also, Mr. Robinson owns 75% of the company to the German’s 25%, hey, hey, hey.
     The question, (paraphrased here) was put very well by a reporter in the Washington Post:
     “Does a cargo airline owned by a U.S. citizen, whose principal customer is a German company owned by the German postal system, qualify as an American-controlled entity?”
     DOT, whenever it makes its final determination, could unleash a furor.
     If DOT says OK to DHL, watch the fun, as the Fed/UPS, lobby from one end of Capitol Hill to the other, calling in favors.
     If DOT says no to DHL, then our trading partners might rightfully see this incident as another example of the new PaxAmericana Bush Doctrine of “Do It Our Way or It’s the Highway.”
     Actually the highway, specifically down on the ground is where DHL is trying to get some juice in the U.S. delivery business.
     But all of this must seem at least a little bit strange to a European visiting the U.S. and mailing a letter from a USPS Post Office with its FedEx box in the lobby, raising the question:
      “What’s the big deal that DHL is hooked up with Deutsche Post? Isn’t FedEx and the U.S. Post?” could be the question.
     Sure, it is not the same—or is it?
     To date, DOT has rejected protests by FedEx and UPS about DHL Airways.
     For the record, DHL operates its major U.S. package hub at Cincinnati/Northern Kentucky International Airport, a place that could lose jobs, if the DHL deal for free market entry is thwarted.
     Stay tuned . . .

UPS Eats Cake As DNATA
Celebrates 100th Flight

Mr. Jean Pierre L. (JD) De Pauw

     Dnata Cargo, cargo handler extraordinaire at Dubai International Airport, recently celebrated the first 100 flights through Dubai by UPS.
     That milestone was enough to have Ismail Ali Al Banna, Director, Airport Services, host a cake-cutting ceremony at Dnata’s Freezone Logistic Center (FLC), attended by senior management from both UPS and Dnata Cargo.
     Ali Al Banna, said:
     “We are very pleased and honored that UPS has chosen Dubai International Airport as its main base of operations in the Middle East.
     “Dnata is fully prepared to continue meeting the high service standards of UPS in the future.”
     For the record, UPS in Dubai moved volume of over 1,100 tons handled during their first year of operations via Dubai International Airport.
     “We are delighted to be celebrating our first 100 flights at Dubai International Airport, which serves as UPS hub in the Middle East,” said Dave Worth, Gateway Manager of UPS.
     “Today UPS operates seven-flights a week westbound and one-flight a week eastbound feeding Asia-Pacific, Europe and fly onwards to the USA using Boeing 767-300 freighters.”
     At DXB, FLC is fully owned operated and managed by Dnata Cargo and is gaining popularity largely because of its no-frills and low cost operational concept.
     The facility’s capabilities to provide tailor-made, flexible and specialized solutions for individual customers are supplemented with rapid handling and minimum dwell-times.
     The facility currently covers about 19,000 square meters of warehousing and 3,300 square meters in offices.
     Since its launch in 1999, FLC has seen the number of new air carriers operating through the facility steadily on the increase, demonstrating its successful formula in this heavily contested share of the freighter market in the region. The number of carriers now using FLC has now reached 30 including Azerbaijan Airlines, Russian carrier East-Line, along with scheduled and charter cargo carriers serving Russian, CIS, African and the Indian subcontinent market. The latest additions include MASkargo, MK Airlines-Panalpina and UPS who utilize the terminal’s flexible, efficient and regionally competitively priced service facilities.
     Commenting on the significance of the event, Mr. Jean Pierre L.(JD) De Pauw, Senior General Manager, Dnata Cargo said: “Dnata and Dubai International Airport have worked very hard to establish themselves as the premier hub for the region.”
     JD added:
     “We have created the right infrastructure, introduced the right services and priced them competitively. It is extremely rewarding that this is recognized by major companies such as UPS choosing Dubai and Dnata, knowing the multitude of alternatives available in the region.”

Air Charter Service, based in UK moved three elephants from South Africa via Malpensa to Prague utilizing an Antonov 12 cargo lifter for the portion of the journey from Italy to the Czech Republic.
“Nice flight,” proclaimed one of the three young ladies who flew aboard the charter. Now there is one group of passengers who think peanuts in cabin service are swell. www.aircharterservice.co.uk.