Originally Posted by
jungle
As to the charters, my guess is that they are more interested in the higher margin activities and as a rule don't seek low margin flying to grow or maintain the size of the airline. .
I have a bit of a unique perspective on the AMC charter business and Salty and I are on the same page w/r/t how this should be shaking out. UPS does not like to commit to a lot of DoD biz for a number of reasons. Principal in this is the ability to sell their share of their CRAF points to other members of their team for cold hard cash. They do tend to cherry pick the quarterlies for volume that can be accommodated within the existing system, eg courier shipments to the Far East, fresh veggies to Japanese commissaries, etc. It is very lucrative for them to operate this way, since we're very light going west from ANC. The other factor that keeps UPS from bidding more AMC contracts is the payment process. The DoD is VERY slow in paying on these contracts. Just ask any POLAR folks from the late 90's. They over-committed to DoD and the slow cash flow almost sunk them. UPS doesn't like the slow payment process.
YMMV
TH1