Go Back  Airline Pilot Central Forums > Airline Pilot Forums > Cargo
This thread is NOT about politics. NOT FDX. No Disgruntled Pairings. >

This thread is NOT about politics. NOT FDX. No Disgruntled Pairings.

Notices
Cargo Part 121 cargo airlines

This thread is NOT about politics. NOT FDX. No Disgruntled Pairings.

Old 08-08-2008, 11:05 AM
  #1  
Gets Weekends Off
Thread Starter
 
penguin22's Avatar
 
Joined APC: Feb 2006
Position: 777 Capt
Posts: 131
Default This thread is NOT about politics. NOT FDX. No Disgruntled Pairings.

But let’s just say on Thursday, an un-named candidate for President visited ILN, and called for Congressional hearings into the DHL/UPS deal.

If we get those hearings, maybe we can discover how DPWN’s Express division (DHL) can make 2 billion USD profit in 2007, yet claim to have lost a billion in the US. How they can buy Airborne Express, a profitable company for like 50 years, then 3 years later tell everybody they’re losing a billion, so we've gotta move it over to UPS

Maybe they’ll ask Rep. Mike Turner’s question:
“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.….. Reportedly, Emery and Airborne operated profitably with DHL operating with minimal losses.
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. 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.”

Has there been a systematic elimination of all smaller express carriers in the US? Maybe, maybe not. But it might be fun to find out.
penguin22 is offline  
Old 08-08-2008, 11:19 AM
  #2  
With The Resistance
 
jungle's Avatar
 
Joined APC: Jan 2006
Position: Burning the Agitprop of the Apparat
Posts: 6,191
Default

Originally Posted by penguin22 View Post
But let’s just say on Thursday, an un-named candidate for President visited ILN, and called for Congressional hearings into the DHL/UPS deal.

If we get those hearings, maybe we can discover how DPWN’s Express division (DHL) can make 2 billion USD profit in 2007, yet claim to have lost a billion in the US. How they can buy Airborne Express, a profitable company for like 50 years, then 3 years later tell everybody they’re losing a billion, so we've gotta move it over to UPS

Maybe they’ll ask Rep. Mike Turner’s question:
“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.….. Reportedly, Emery and Airborne operated profitably with DHL operating with minimal losses.
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. 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.”

Has there been a systematic elimination of all smaller express carriers in the US? Maybe, maybe not. But it might be fun to find out.
Let's suppose for a moment that the deal is cancelled. Now what? Do you actually believe that DHL can be forced to continue on a losing investment in the US market? Their withdrawal from the market would send their US market share to Fedex and UPS.
How does that mesh with your anti-trust conspiracy theory?
Unlike passenger airlines, the package delivery business requires huge upfront capital investments in infrastructure-DHL has not made those investments and has not been competitive in the market.
You make the argument that DHL has suffered no loss in the US market-this is just false. Both the US and German governments accept their accounting and financial statements as correct and they are independently audited by an outside accounting firm.
Just as a side note, do you know what other cargo airline DHL holds a 49% stake in?

Last edited by jungle; 08-08-2008 at 11:29 AM.
jungle is offline  
Old 08-08-2008, 11:34 AM
  #3  
Retired Doug herder
 
hvydriver's Avatar
 
Joined APC: Mar 2005
Position: Former DC8 73 Capt DHLAirways/Astar. Retired
Posts: 424
Default

Well, they are almost full owners of Blue Dart in India, are working on buying controlling interest in Air Hong Kong of which they currently own almost half (the A300-600F operator) own all of EAT and DHL Air (the European lift) half of Aerologic (the new B777F operation in LEJ) and 49% of Astar and Polar. The only ones they don't own either half or all of is ABX Air, and various small feeder operators. So the contention made by some that DHL is not directly involved in airline ownership is incorrect.
hvydriver is offline  
Old 08-08-2008, 11:42 AM
  #4  
Gets Weekends Off
Thread Starter
 
penguin22's Avatar
 
Joined APC: Feb 2006
Position: 777 Capt
Posts: 131
Default

Originally Posted by jungle View Post
Let's suppose for a moment that the deal is cancelled. Now what? Do you actually believe that DHL can be forced to continue on a losing investment in the US market? Their withdrawal from the market would send their US market share to Fedex and UPS.
I agree. Nobody can force DHL to stay in the US. What's done is done. But I know a lot of guys who are losing their jobs over this, and exposing some truth here might be satisfying.
Originally Posted by jungle View Post
Unlike passenger airlines, the package delivery business requires huge upfront capital investments in infrastructure-DHL has not made those investments and has not been competitive in the market.
That infrastructure was already in place.
Originally Posted by jungle View Post
You make the argument that DHL has suffered no loss in the US market-this is just false. Both the US and German governments accept their accounting and financial statements as correct and they are independently audited by an outside accounting firm.
Oh come on. You think corporations have never moved profit/loss amoung different operating units to show what they want to show?
Originally Posted by jungle View Post
Just as a side note, do you know what other cargo airline DHL holds a 49% stake in?
Polar
penguin22 is offline  
Old 08-08-2008, 11:42 AM
  #5  
With The Resistance
 
jungle's Avatar
 
Joined APC: Jan 2006
Position: Burning the Agitprop of the Apparat
Posts: 6,191
Default

Originally Posted by hvydriver View Post
Well, they are almost full owners of Blue Dart in India, are working on buying controlling interest in Air Hong Kong of which they currently own almost half (the A300-600F operator) own all of EAT and DHL Air (the European lift) half of Aerologic (the new B777F operation in LEJ) and 49% of Astar and Polar. The only ones they don't own either half or all of is ABX Air, and various small feeder operators. So the contention made by some that DHL is not directly involved in airline ownership is incorrect.
Correct. They own large stakes in other airlines involved in cargo operations. The presumption that US politics can control their desire or ability to stay in a given market is where your argument goes astray.
GM lost 15 Billion last quarter, do you suppose they are imaginary losses also? Do you suppose a politico can tell them to keep operating the same way they did last year?
DHL has been on a long losing streak in the US market, they need to stop the bleeding, and projected losses are extremely high without changes in their business plan.
For that matter, their losses are projected to be quite high even with the proposed changes.
jungle is offline  
Old 08-08-2008, 12:00 PM
  #6  
Gets Weekends Off
Thread Starter
 
penguin22's Avatar
 
Joined APC: Feb 2006
Position: 777 Capt
Posts: 131
Default

Originally Posted by jungle View Post
For that matter, their losses are projected to be quite high even with the proposed changes.
That's only for what they claim in the US. DHL is making money
Deutsche Post Annual Report 2007 - Revenue and earnings performance

I agree with Rep. Turner. I think they bought Airborne with the sole intent of putting it out of the express business. UPS was always in the long range plan.

Watching DHL in ILN the last couple years was like watching a company trying to fail.
penguin22 is offline  
Old 08-08-2008, 12:01 PM
  #7  
Gets Weekends Off
 
Joined APC: Dec 2007
Posts: 829
Default

It isn't necessarily only about cooking the books. Didn't some passenger carrier make some bad moves in the recent past, ostensibly to make a merger approval look that much more appealing? But then when the merger did not happen, they were in worse shape than when they started.

By the way, it isn't about the gov't trying to influence the market. It is about the gov't enforcing its laws. What happens to the market is secondary unless it is a matter of national security / stabilizing the economy / etc. If there was an attempt to skirt US law, then the law needs to be enforced - the ends do not justify the means.
LivingInMEM is offline  
Old 08-08-2008, 12:01 PM
  #8  
Retired Doug herder
 
hvydriver's Avatar
 
Joined APC: Mar 2005
Position: Former DC8 73 Capt DHLAirways/Astar. Retired
Posts: 424
Default

Originally Posted by jungle View Post
Correct. They own large stakes in other airlines involved in cargo operations. The presumption that US politics can control their desire or ability to stay in a given market is where your argument goes astray.
GM lost 15 Billion last quarter, do you suppose they are imaginary losses also? Do you suppose a politico can tell them to keep operating the same way they did last year?
DHL has been on a long losing streak in the US market, they need to stop the bleeding, and projected losses are extremely high without changes in their business plan.
For that matter, their losses are projected to be quite high even with the proposed changes.
We are going to have to agree to disagree Jungle. With DHL giving up control of the delivery of its product in the US, there are indeed actual anti-trust concerns here. Just because you don't see it, doesn't make it so. As Penguin said, the money shell game has been going on with DPWN/DHL for many years now. Our hope is that these hearings will flush these things into the open. Interesting that UPS spent big dollars lobbying for the DHL/UPS deal to happen: UPS spent more than $1.3M lobbying in 2Q - Forbes.com
hvydriver is offline  
Old 08-08-2008, 12:09 PM
  #9  
New ride...
 
1800 RVR's Avatar
 
Joined APC: Apr 2005
Posts: 534
Default

penguin22,

I'm not trying to add fuel to the fire, but the "political candidate" that you refer to is the same one that got you guys into this predicament. Yes, that is right. The presumed Rep. nominee is the same guy that relaxed rules so that Deutsche Post could expand here, and now he is going to go to bat for you? Where was he before? IF Deutsche Post is the "enemy", why would you support the man who helped allow them to come here?

McCain calls for probe of company he once aided | Nation/World News from AP | Star-Telegram.com
1800 RVR is offline  
Old 08-08-2008, 12:16 PM
  #10  
With The Resistance
 
jungle's Avatar
 
Joined APC: Jan 2006
Position: Burning the Agitprop of the Apparat
Posts: 6,191
Default

Originally Posted by hvydriver View Post
We are going to have to agree to disagree Jungle. With DHL giving up control of the delivery of its product in the US, there are indeed actual anti-trust concerns here. Just because you don't see it, doesn't make it so. As Penguin said, the money shell game has been going on with DPWN/DHL for many years now. Our hope is that these hearings will flush these things into the open. Interesting that UPS spent big dollars lobbying for the DHL/UPS deal to happen: UPS spent more than $1.3M lobbying in 2Q - Forbes.com
The Forbes article you refer to lists many thing UPS lobbying efforts were devoted to, not just DHL. There may be actual anti-trust concerns, but it is sure bet that whatever concerns there may be, DHL won't continue their relationship with ABX/Astar.
One of the foremost problems this country has is that our corporate taxes are the second highest in the world, second only to Japan. The health and well-being of our economy lies in attracting and keeping profitable business in this country. The red herring of anti-trust really won't matter in the end, and DHL will act as it chooses to maintain it's economic health.
It is easy to say that a master plan of conspiracy has been in the works for years, but when you start looking underneath the rocks all you will find is mismanagement and the natural course of more competitive companies eliminating the less competitive.
jungle is offline  

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On


Thread Tools
Search this Thread
Your Privacy Choices