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DHL's Big Annoucement on Wednesday
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<blockquote data-quote="BrownSuit" data-source="post: 345277" data-attributes="member: 14437"><p>This is from Traffic World Today:<em></em></p><p><em></em></p><p><em>DHL, USPS, FedEx to Cooperate</em></p><p><em>5/27/2008</em></p><p><em>Robert W. Moorman </em></p><p><em>Air Cargo World </em> <em>DHL signed a major air freight agreement with the United States Postal Service.</em></p><p> <em>Deutsche Post World Net plans to announce details of the agreement via webcast from Bonn on Wednesday.</em></p><p> <em>The agreement calls for FedEx to carry some air freight on behalf of the USPS. Sources familiar with the agreement said FedEx will take over some unprofitable air routes initially and increase the service gradually.</em></p><p> <em>DPWN Chief Executive Officer Frank Appel is also expected to announce the closing of a quarter of DHL's U.S. stations and the elimination of hundreds of jobs. DHL is expected to redirect its growth efforts on its international service.</em></p><p> <em>FedEx and DHL declined to comment and the USPS was non-committal about the venture. </em></p><p> <em>In January 2001, FedEx and the Postal Service announced two major agreements. One called for FedEx Express to provide airport-to-airport movement of containers holding around 3.5 million pounds of Priority Mail, Express Mail and First Class Mail. That agreement was modified in 2006 to run through 2013. The other part of the agreement involved the drop off of packages at FedEx Drop Boxes nationwide. The venture is expected to generate approximately $8 billion over the life of the agreement.</em></p><p> <em>The USPS declined to say how much it pays FedEx annually.</em></p><p></p><p></p><p>This is from Dow Jones Newswire:</p><p><em></em></p><p><em>US Revamp By DHL May Have Little Impact On Rivals</em></p><p> <em><a href="http://www.dj.com/" target="_blank"></a></em></p><p><em><a href="http://www.dj.com/" target="_blank"></a></em> <em>May 27, 2008: 04:59 PM EST</em></p><p><em></em></p><p></p><p> <em>CHICAGO -(Dow Jones)- The long-awaited plans by DHL to shrink its U.S. package delivery unit, which has lost around $3 billion over the past four years, are expected to provide little short-term lift to rivals.</em></p><p><em> The global logistics group, part of Germany's Deutsche Post AG (DPW.XE), will unveil the fate of its DHL Americas Express unit after a board meeting Wednesday.</em></p><p><em> Deutsche Post has, despite acquisitions and heavy investment, failed to loosen the grip of United Parcel Service Inc. (UPS), FedEx Corp. (FDX) and the U.S. Postal Service, or USPS, on the delivering of express documents and packages in the U.S.</em></p><p><em> DHL's market share in the domestic air express market remains below 10%, and is around 2% for ground services, despite the presence in major cities of its distinctive red and yellow delivery trucks.</em></p><p><em> While speculation since the start of the year has swirled around a possible sale of the U.S. express unit to FedEx or UPS, antitrust issues would make such a move tricky, according to analysts.</em></p><p><em> Industry insiders expect Frank Appel, Deutsche Post's new chief executive, to eschew selling or closing the U.S. unit in favor of shrinking its footprint and forging partnerships to serve the markets it exits, notably with USPS.</em></p><p><em> USPS declined to comment on expanding its existing ties with DHL, but a senior executive said it was in a position to expand rapidly after recently securing regulatory approval to offer commercial pricing and contracts to business customers.</em></p><p><em> "Yes, we have the capacity to take extra volume," said Gary Reblin, vice president for expedited mail at USPS.</em></p><p><em> DHL declined to comment ahead of Wednesday's announcement, but industry expectations are that it will close as many as a quarter of its 400 U.S. air and ground terminals.</em></p><p> <em>FedEx and UPS are expected to take up the slack of carrying priority documents and packages to and from airports for shipment, and then on to USPS terminals for "last-mile" delivery to businesses and homes.</em></p><p><em> Some analysts believe DHL could lose as much as a third of its U.S. business from such a move as customers switch providers to avoid a fragmented supply chain. However, even such a scenario would add only 1% to the expected 2008 earnings of FedEx and 1.2% at UPS, according to analysis by Ed Wolfe at Wolfe Research.</em></p><p><em> Deutsche Post's Happel has already moved to stabilize the loss-making North American express business, last month appointing Ken Allen to head the operation.</em></p><p><em> Happel has already indicated that the company plans to retain a substantial U.S. presence to support a global logistics and delivery business that ranks as the largest in the world by revenue.</em></p><p><em> His comments are validated by a new five-year deal with the Teamsters, covering 10,000 U.S. staff. DHL Express Americas also started offering shipping services last month from Walgreen Co. (WAL) stores, and plans to expand to cover almost all of the company's U.S. outlets by the end of the year, doubling its retail presence.</em></p></blockquote><p></p>
[QUOTE="BrownSuit, post: 345277, member: 14437"] This is from Traffic World Today:[I] DHL, USPS, FedEx to Cooperate 5/27/2008 Robert W. Moorman Air Cargo World [/I] [I]DHL signed a major air freight agreement with the United States Postal Service.[/I] [I]Deutsche Post World Net plans to announce details of the agreement via webcast from Bonn on Wednesday.[/I] [I]The agreement calls for FedEx to carry some air freight on behalf of the USPS. Sources familiar with the agreement said FedEx will take over some unprofitable air routes initially and increase the service gradually.[/I] [I]DPWN Chief Executive Officer Frank Appel is also expected to announce the closing of a quarter of DHL's U.S. stations and the elimination of hundreds of jobs. DHL is expected to redirect its growth efforts on its international service.[/I] [I]FedEx and DHL declined to comment and the USPS was non-committal about the venture. [/I] [I]In January 2001, FedEx and the Postal Service announced two major agreements. One called for FedEx Express to provide airport-to-airport movement of containers holding around 3.5 million pounds of Priority Mail, Express Mail and First Class Mail. That agreement was modified in 2006 to run through 2013. The other part of the agreement involved the drop off of packages at FedEx Drop Boxes nationwide. The venture is expected to generate approximately $8 billion over the life of the agreement.[/I] [I]The USPS declined to say how much it pays FedEx annually.[/I] This is from Dow Jones Newswire: [I] US Revamp By DHL May Have Little Impact On Rivals[/I] [I][URL="http://www.dj.com/"] [/URL][/I] [I]May 27, 2008: 04:59 PM EST [/I] [I]CHICAGO -(Dow Jones)- The long-awaited plans by DHL to shrink its U.S. package delivery unit, which has lost around $3 billion over the past four years, are expected to provide little short-term lift to rivals.[/I] [I] The global logistics group, part of Germany's Deutsche Post AG (DPW.XE), will unveil the fate of its DHL Americas Express unit after a board meeting Wednesday.[/I] [I] Deutsche Post has, despite acquisitions and heavy investment, failed to loosen the grip of United Parcel Service Inc. (UPS), FedEx Corp. (FDX) and the U.S. Postal Service, or USPS, on the delivering of express documents and packages in the U.S.[/I] [I] DHL's market share in the domestic air express market remains below 10%, and is around 2% for ground services, despite the presence in major cities of its distinctive red and yellow delivery trucks.[/I] [I] While speculation since the start of the year has swirled around a possible sale of the U.S. express unit to FedEx or UPS, antitrust issues would make such a move tricky, according to analysts.[/I] [I] Industry insiders expect Frank Appel, Deutsche Post's new chief executive, to eschew selling or closing the U.S. unit in favor of shrinking its footprint and forging partnerships to serve the markets it exits, notably with USPS.[/I] [I] USPS declined to comment on expanding its existing ties with DHL, but a senior executive said it was in a position to expand rapidly after recently securing regulatory approval to offer commercial pricing and contracts to business customers.[/I] [I] "Yes, we have the capacity to take extra volume," said Gary Reblin, vice president for expedited mail at USPS.[/I] [I] DHL declined to comment ahead of Wednesday's announcement, but industry expectations are that it will close as many as a quarter of its 400 U.S. air and ground terminals.[/I] [I]FedEx and UPS are expected to take up the slack of carrying priority documents and packages to and from airports for shipment, and then on to USPS terminals for "last-mile" delivery to businesses and homes.[/I] [I] Some analysts believe DHL could lose as much as a third of its U.S. business from such a move as customers switch providers to avoid a fragmented supply chain. However, even such a scenario would add only 1% to the expected 2008 earnings of FedEx and 1.2% at UPS, according to analysis by Ed Wolfe at Wolfe Research.[/I] [I] Deutsche Post's Happel has already moved to stabilize the loss-making North American express business, last month appointing Ken Allen to head the operation.[/I] [I] Happel has already indicated that the company plans to retain a substantial U.S. presence to support a global logistics and delivery business that ranks as the largest in the world by revenue.[/I] [I] His comments are validated by a new five-year deal with the Teamsters, covering 10,000 U.S. staff. DHL Express Americas also started offering shipping services last month from Walgreen Co. (WAL) stores, and plans to expand to cover almost all of the company's U.S. outlets by the end of the year, doubling its retail presence.[/I] [/QUOTE]
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