UPS making good progress on DHL deal
 

Hopefully we will get this deal signed soon.


CHICAGO, July 22 (Reuters) - Package delivery company United Parcel Service Inc (UPS.N: Quote, Profile, Research, Stock Buzz) is "making good progress" on concluding a 10-year agreement to provide North American air service for DHL, the company's top official said on Tuesday.

UPS and the express unit of Deutsche Post (DPWGn.DE: Quote, Profile, Research, Stock Buzz) said during the second quarter that they were working on an agreement for UPS to haul DHL's express, deferred and international packages within the United States and between the United States, Canada and Mexico. (Reporting by Nick Carey, editing by Gerald E. McCormick)

The deal is done, DHL has already taken action to get rid of ABX and ABX's parent company has been delisted on the Russell 2000 stock index.
I suspect they are just ironing out a few details at this point, but the moves have already started.

ABX parent dropped from Russell 2000: bizjournals.com Business News: US:UPS - MSN Money

[QUOTE=FlyByCable;430845]Hopefully we will get this deal signed soon.


You mean so we can start our furloughs here at ABX or what? What do you mean? I guess If I were a UPS crewmember I wouldnt really care if the deal goes through or not. Of course I'm on the wrong side of the fence but UPS seems to be doing ok considering the economic times we are in. If a little more profit meant that thousands would lose thier jobs I guess I would probably pass.

[QUOTE=ultradrvr;430940]
UPS isn't doing this to ABX, DHL is doing this. They have chosen to use another vendor for required services. Whether we care or not isn't going to have an effect on the way these companies persue their business.
Going broke doesn't make for a good working environment.

[quote=ultradrvr;430940]
While I feel for the position that you and the Astar pilots are in, the fact is that UPS needs this deal to go through. So yes, I hope the deal gets done quickly to protect our junior pilots.

[quote=jungle;430946]

Exactly!!!

well there you have it....get all you can get....good to know a brother teamster is pulling for us. No need to respond, this will be my last for this thread.

Girls,
Let's not forget that this transaction is between two COMPANIES and not two PILOT groups. The two COMPANIES didn't ask the pilots before they did this and to think or act like it did is BS.
Yes, this will hurt one pilot group and benefit another. However, when you say "you got yours" or something along those lines it's pure emotion speaking. Neither pilot group had anything to say about it and a person speaking the truth (it will benefit one group but not both) doesn't mean someone means ill will towards you or your family.
Also one should not rub anothers face in their good forture (IE like some of our 60 plus brethren have done).
Everyone reach up and pull their panties out, they seem to be stuck in a wad...
Biff

We aren't teamsters, and we aren't doing this to you. DHL has lost billions in the US market, this isn't our fault, UPS's fault, or your fault. Contracts and Unions become meaningless in the face of losses like this, if you want to blame someone DHL management might be a good place to start.

I think what others are saying is that this is a done deal. The politians can cry all they want, this is going to happen. The pilots at UPS had nothing to do with the decision, but there reamains a possiblity that there could be growth or at least no furlough here. Nobody likes to see it at the expense of others, but like I said, it is a done deal. I wish everyone associated with DHL the very best, but yes, I also want the IPA membership to grow, not get smaller.

[QUOTE=ultradrvr;430940]Only on the 3rd response does the crap start flying ... getting slow on the reaction time.

:rolleyes:

You wouldn't be given the choice to "pass" ...

Probably half of the DHL cargo won't even see the inside of a UPS aircraft, as if we could do something about it anyway !

DHL management is the one to be angry with. And your own management for letting things get to this point.

Slamming a UPS crewmember indicates your complete arrogance and ignorance of the circumstances that surround this deal.

Later,

Brown CC

Time to move it
 

I think in consideration of those about to get hurt in this deal, that we should move our discussion of this deal to our B&G.

TH1

Salt in the wounds
 

I side with the ABX/Astar drivers on the necessity of this post. Maybe it's because I have some very close friends who started at ABX and DHL as wholey owned airlines about the time I was hired at UPS. ABX wages among others were used to strengthen our arguments for higher wages, etc.
Maybe in 10-15 years UPS contracts out most of our Intl. ops.
Know it's business blah blah, but our junior IPA pilots are not under threat of furlough without the business deal. Have many posts on the subject how UPS is extraordinarily optimized in the modes of transport and they are as furlough proof as we ever have.
Good for us, but an IPA pilot didn't need the DHL contract to have a job. UPS still PI$$es away current contracts. In any case, it is salt in the wounds as I watch these buds looking at hell in the face.

Well said TH1. Even though none of the pilots on either side has any control over this deal, it does sting when someone posts a sentiment that appears to hope for the end of so many other pilot's careers. For those of us on the wrong side of this deal, every month that an agreement between UPS and DHL is delayed means a couple more decent paychecks before the door slams shut. While I certainly don't wish for any junior UPS guys to be furloughed, odds are, they will eventually be recalled. When ABX and ASTAR guys get the letter, it will be forever. Think how it would have sounded when Eastern or Pan Am were disappearing if Delta or American pilots were heard in public saying they were looking forward to getting the extra passengers.

Dog, You posted while I was still typing my last post. Thanks for your support.

Thanks guys. I knew there were some decent folk over there at Brown. ;)

Not according to Lekites. He says that if no DHL deal, all DC-8s parked and furloughs commence. What's your source that says otherwise?

I agree, what's the point of rubbing it in for our felow yellow aviators? To them it's like a funeral... and some of us are acting as if a big party was going on... :(

I don't know what Lekites said. Perhaps you can post for everyones knowledge. I do know that UPS managers/planners in SDF stated last November that they were going to keep the 8's parked on the ramps and at ROW through the summer of 2008 to cover peak flying to minimize outside peak contracting. Also the plan for 2009 and beyond. It appeared obvious at the BPM's attended as a line slug that UPS didn't really want to get caught short of lift, 8's give UPS alot of options/bargaining power on the cheap. One is negotiating power with customers to prevent Fedex from pointing out how short UPS is on lift and how that can affect service, also allows UPS to mull over future 767 deliveries, etc with Boeing, like when UPS can'xd the rest of the A300 deliveries. Even if 8's are parked, likely they would not dump the 767 orders at same time giving UPS a huge shortfall in lift. If they trade out the 767 for an 8, still will need crews to staff the new deliveries.
Other clues UPS puts out despite claims of imminent furlough, DC-8 crews are considered critical through peak, they will also be 'critical' for peak 2009 if the Peak Planning team has their way. Also, as I frequently posted in other threads, the network is greatly optimixed, UPS from 97-present has constantly been maximizing lift on airplanes for specific destinations to make core product service. In other words, a boatload of NDA product goes from SDF to ORD via truck and not by plane. Only the really highly profitable early am delivery stuff makes the planes because ground transport doesn't make it in time. We use to have 30 pilots a week needed to make service from gateways like BHM-SDF (using an 8 and a 727 because SDF couldn't take all the volume). With 1. Worldport capacity now capable, 2. Teamsters gave UPS Team drivers
3. A300. UPS now only needs 10 pilots a week. But 10 very critical pilots that are optimized. If Lekites wants to make service which UPS brags is the reason for their success, their is a minimum of airplanes necessary to make that service. UPS is pretty close to that margin. You can post that Lekites says we are going to furlough and park 8's, am sure he says this to whomever. The business facts don't really support the model as they are clearly using. Bluster is good, but in this case, not supported by what the rest of management is doing. UPS also stated that they were going to reduce the crews in each fleet to optimize, notice that they did not follow through on this bluster either. Why? Perhaps because the working managers knew that they really can't cut the meat because the system is fairly well optimized as a whole. Just my observations from being in SDF, working in the TC, and seeing and talking with lots of different management types, etc.

I'm not sure that statement is as true as you or I would like to believe that it is. We had a briefing from the airline pres. in CGN a week or so back and he pretty much laid it on the line for us. Without this deal we were heading for some very unpleasant news. Don't forget that these guys react and their reactions don't always meet the situation. They are experts at making the square peg fit the round hole. They will cut off their nose to spite their faces. In the end it all works out for them.

Looks like it's not a "deal" anymore. Finally they are calling it for what it is. Looks like the politicians see the light. There is some wierd stuff going on. Does the IPA see it? Best of luck.

Lawmakers call deal ‘de facto merger’

CLINTON COUNTY
By GARY HUFFENBERGER
[email protected]

In a letter from the Ohio congressional delegation to the nation’s two antitrust enforcement agencies, the legislators say the proposed deal between United Parcel Service (UPS) and DHL will result in a “de facto merger” of the companies.
The term “de facto” means “in practice” or “in effect.” The lawmakers’ assertion that the deal will, in effect, have the outcome of a merger between UPS and DHL for the U.S. market is the strongest public language to date made by Ohio members of Congress, according to Wilmington Mayor David Raizk.
“Yes, it is a strong statement. And I appreciate that strong statement because I think it reflects what we’ve all been thinking and working on, but this is the first time we’ve seen it in print,” Raizk said Monday.
The page-and-a-half letter, not counting the signatures of the Congress members, was sent last week to the U.S. Department of Justice’s Antitrust Division as well as the Federal Trade Commission.
Among other purposes, antitrust law in general supervises the mergers and acquisitions of large corporations, including some joint ventures. Transactions that are considered to threaten the competitive process can be prohibited altogether, or approved subject to remedies such as an obligation to divest part of the merged business, according to Wikipedia.
The DHL press office on Monday released a statement after it was asked to comment on the lawmakers’ letter. Here it is verbatim.
“The proposed agreement under negotiation with UPS is not a merger, acquisition or joint venture. It represents a pro-competitive opportunity to safeguard and enhance a competitive choice in the U.S. domestic market to the benefit of consumers. The agreement would be solely a customer-vendor arrangement whereby DHL purchases certain airlift and related services from UPS, as we do currently from other providers,” according to DHL.
“Such arrangements have been common in the transportation industry for some time and are not subject to prior regulatory approval,” DHL added.
“We expect an agreement with UPS would deliver significant cost savings from reduced air lift costs, which will help ensure the sustainability of our U.S. express operations. If DHL cannot significantly cut its cost in its air service, it could end up affecting tens of thousands of employees of DHL and of our vendors and suppliers across the country,” the DHL statement concluded.
But the Ohio congressional delegation’s letter said by having UPS provide air carrier services for DHL in North America, the proposed contract “will allow for UPS and DHL to integrate key strategic assets.”
“If a final agreement is reached, DHL will surrender control over cost and service quality to one of its chief competitors, UPS, one of the two largest package delivery companies in the U.S. market,” said the congressional delegation’s letter.
The congresspersons’ letter added, “We are very concerned that any agreement between DHL and UPS in such a concentrated market increases the likelihood of anticompetitive collusion in that market.”
The legislators asked the two enforcement agencies to “immediately open” an investigation into the proposed agreement between DHL and UPS.
Copies of the letter were sent to the president of the German Federal Cartel Office along with the European commissioner for competition.
Previously, in a June 5 letter to U.S. Attorney General Michael Mukasey, U.S. Rep. Mike Turner and other Ohio legislators wrote, “As a result of meetings that Ohio members have had with representatives at DHL, it is our understanding that DHL has confirmed that their proposed strategic relationship with UPS in the U.S. may extend into other markets.”
The Sherman Antitrust Act was signed into law in 1890 and was named after its author, U.S. Sen. John Sherman, an Ohio Republican, chairman of the Senate Finance Committee. After passing in the Senate by a vote of 51-1, the legislation passed 242-0 in the House of Representatives.

The only people not calling it a deal are the Ohio delegation. What do you expect them to call it? It's all politics on their side. Call it whatever you want, but it will go through.

What do you expect from a politician? I would only think it is wierd if they were not trying to save jobs in their district. They can call it what they want, but the deal will go through.


Also SD, I have heard from many sources, for what it is worth, that furlough was and is a possibility without the DHL deal. True or not true, that is what I have been told.

So what did he have to say last week in CGN? If we do get the deal signed, will there be hiring this/next year?

Yes, not sure of when, but yes.

blah, blah, blah...."we are always looking for planes but do not have any 767s ordered...." Oh wait yea we do. Does it really matter what he said or did not say?

Ding Ding Ding, we have a winner! If youve been on UPS property for more than 6 months, you already know not to listen to a word they say in these "meetings." Or better yet, just take what they say and expect the exact opposite to happen.

dos pesos, and thats about all its worth.......

I'm just amazed that are highly educated and alert ipa bro's and sis's actually decided to attend such gathering after all the lies and specially the 767 meeting fiasco last yr, I just hope the food and the free drinks worth attending such meeting with the most pilot hating individual as a guest speaker but i'm sure everyone had thier reasons.:rolleyes:

Anti-trust :rolleyes:

Fed Ex gets a contract to haul mail and thats not considered a “de facto merger” How many pilots did that put out of work? UPS buys Menlo and gets the Emery freight and that wasn't an anti trust issue. UPS bought Challenge and that wasn't an issue. UPS bought IPX and it wasn't an issue. Fed Ex bought tigers and it wasn't an issue. DHL contracted these flights to ABX and ASTAR. They awarded the contract to UPS now. How is that anti-trust? It isn't UPS' fault that Airborne ABX sold out to DHL in the first place. ABX would still be flying if that was the case. Don't blame UPS and the pilots for this. Blame Airborne and DHL managers. Fed Ex was trying to get this volume too.

The USPS is not subject to anti-trust laws.

The rest of your statements include the word "bought". There is a difference.

Also, those deals(Challenge, Menlo, etc.) are all being looked at as a whole in this deal. UPS has quitely and methodically been transforming itself into a monopoly. When you put all these deals together it is huge. Imagine if Kroger bought Piggly Wiggly a few years ago, then moved and bought a portion of Publix, then a few years later bought Winn Dixie. Individually these seem harmless but put together, they are huge and harmful to the American consumer. Anti-trust/collusion laws are very complicated, most of which I don't even attempt to understand but I do understand what they are looking at here and why.

Its a contract, not a buyout or merger, so I dont really see how it would be subject to anti trust laws, but I'm not a lawyer either.

I would imagine that since the UPS and DHL people have announced this, I'm sure they did their legal homework and figure its got about 99.9% chance of going through.

On another note, contracts end and thats when the sh!t hits the fan. If the DHL contract is finalized (extremely likely) there will come a time that it will be awarded to someone other than UPS, then bad stuff happens with UPS pilots.

Although it may be good in the short term for UPS pilots, in the long run it will cause the same pain that it is now causing the ABX and Astar pilots.

These contracts dont last forever..........

We are all in the same boat in the end fellas. Something to consider.

What is happening to the cargo industry as a whole is not good either. Revenues are down, fuel prices are at record highs, and business is off. They are still making money hand over fist, but profits are down. Not the end of the world by any means, and thing will get better, but there will be some pain involved for everyone, thats for sure.

The whole "good progress" part is insensitive to those pilots whose jobs will be lost
 

Fellow Pilots,

I think the anger in some posts here is understandable. Picture yourself flying at Ryan Intl., Express One, Kitty Hawk, or one of the other postal carriers back when Fedex took over the USPS contract back in 2001. Whole fleets of planes were parked and many pilot's careers were destroyed. I would guess that very few of them, if any, ended up at Fedex. If you were one of these pilots, and you read about this great "progress", well.... You might feel differently.... No different than reading on the "progress" of your foreclosed home's auction in the local newspaper, or watching the "progress" of your foreclosed home being bulldozed.

This situation is no different. The chance of any of those DHL or ABX pilots getting on at UPS because of their extra flying is unlikely if you look at history. Maybe you guys and gals can chime in, but I have heard that not a single Challenge pilot got on at UPS after their purchase. History does not bode well for pilots whose companies or routes were acquired by UPS, just ask those Orion and Interstate pilots who were promised jobs there to no avail.

As for Ohio, first Menlo-Emery, now DHL-ABX, I can understand how they might not view this as progress. These deals have been very destructive to Ohio's economy.

Finally, I don't blame the IPA pilots for this at all. I lived in, then ran a UPS crashpad in SDF in the 90's and worked with the IPA and Captain Bob Miller during the IBT Strike in '97 and I can say unequivocally that they are a great bunch of pilots. But I also understand the emotion in the posts of those pilots affected by this "progress".

Bottom Line: Don't be too excited when market forces allow your company extra work by the destruction of another company. When even ONE pilot is unemployed, paying for training, or flying for free, it allows management to say "Hey, we have people that will PAY to do your job".

Good luck to us all during these tough times, especially to those pilots of Astar and ABX.

In Unity,

B727DRVR

:cool:

Great post B727Drvr!

Thanks AV80R and SaltyDog,

It is from the heart that I write these posts, because I have been on both sides of the merger/furlough story. I'm glad that such a great group will be getting more business and stability, but I am very disappointed about the coldness and insensitivity of some of these posts on this forum... Not even, "Hey dude, sorry for your bad luck...". Just cold matter-of-fact it's good for me/us posts from some. Heck, they can even feel that way, just don't voice it publicly. Or at least they should have the courtesy to gloat (or even be realistic) in the IPA Bar and Grill.

I, too, would be happy for the additional business and stability if I were a UPS pilot; I just wouldn't be proclaiming it publicly. Like you said, it's an unnecessary post and just salt in the wounds of those about to lose their jobs. And like VictorBravo said, "We are all in the same boat in the end fellas. Something to consider."

Thanks for being sensitive, respectful, and encouraging to those fellow pilots at Astar and ABX in such a precarious situation. You represent your IPA and all fellow pilots with honor. May the wheel of justice treat you well.

Thanks and take care.

In Unity,

B727DRVR

I can assure you that the vast majority of UPS pilots do care about what's happening to you guys. In fact, I personally think it's amazing how well regarded both Astar and Abx pilots are among the UPS pilots I've flown with. Having come from the pax side of the business I’ve seen the, in my view, more aggressive competition amongst the pilots. I fully expected to see some "we finally showed them," "we're the best," etc. comments and attitudes but instead the majority seem to show concern and respect for you guys.

I am not saying this to make y'all feel better, I'm saying this because that's what I've experienced when discussing this issue with other brown aviators and I must say I'm encouraged to see that kind of attitude because I think that bodes well for our group’s unity. Hopefully we’ll see many of y’all join our ranks and then you’ll se what I’m talking about.