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|Turner also says the DHL move may not limited to the company’s money losing US operations. He says senior DHL officials acknowledged that the UPS-DHL strategic alliance in the U.S. market may include UPS-DHL's Asian and European operations in the future.
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While troubling news to many parcel shippers, the announcement in June by DHL that it would substantially revamp its money-losing US network and outsource air freight movement and sortation to UPS is even bigger news in Ohio, where the plans include shutting down DHL’s hub in Wilmington, costing as many as 8,000 jobs. (See What is the Real Story Behind Revamped US Plans by DHL?, DHL Responds to Questions about Service, Outsourcing.)
Is the story over? Perhaps not yet.
First, ASTAR Air Cargo flight crew members, represented by the Air Line Pilots Association (ALPA), have filed a union grievance requesting a full investigation of alleged contract violations that might result from a proposed agreement between DHL and United Parcel Service (UPS).
“We are outraged over the proposed transfer of our work to UPS,” Capt. Patrick Walsh, chairman of the ASTAR pilots’ union, said in a press release. “The proposed DHL/UPS agreement is a fraud against our pilots, thousands of other hard-working employees, and all the American consumers who use express delivery. It seems the company will stop at nothing to circumvent antitrust laws and scam the consumers.”
Meanwhile, several Ohio legislators are also looking at issues that might perhaps scuttle or change the deal.
Mike Turner, a congressman from the Dayton area that includes the Wilmington DHL hub, noted that this latest move is one of a string of transactions over the past few years that in total have dramatically reduced total competition in the express transportation market.
“Rewind to just five years ago and you will find DHL operating at the Cincinnati-Northern Kentucky airport, Emery Worldwide operating at the Dayton airport, and Airborne Express operating in Wilmington. These three facilities were located in Southwest Ohio to take advantage of our central location and great workforce. Reportedly, Emery and Airborne operated profitably with DHL operating with minimal losses,” Turner recently wrote.
“Five years ago, if UPS and DHL had announced the formation of a strategic alliance that would include the acquisition of Emery and Airborne and the consolidation of all four companies' U.S. operations, antitrust alarms would be blaring,” he added. “Certainly, this new transaction needs to be viewed in light of the possibility that the acquisitions of Emery and Airborne were steps one and two of a stepped transaction. Perhaps, the UPS-DHL combination is step three.”
Turner also says the DHL move may not be limited to the company’s money losing US operations. He says senior DHL officials acknowledged that the UPS-DHL strategic alliance in the US market may include UPS-DHL's Asian and European operations in the future.
Turner, Ohio Senators Sherrod Brown and George Voinovich, and other legislators recently sent a letter to US Attorney General Michael Mukasey, requesting the Justice Department look closer at DHL’s planned agreement with United Parcel Systems, citing the potential anti-competitive impact of the deal.
(Transportation Management Article - Continued Below)