DHL walking away from $3.1B in US revenue
11-15-2008, 05:11 PM
#1
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DHL walking away from $3.1B in US revenue
Very simplistic and dirty math here so go easy on me but...
According to the DPWN's cc last week, DHL is walking away from $3.1B a year in domestic USA revenue by January 31, 2009.
Knowing that the deal between UPS/DHL was supposed to be for $1B a year, it now seems that if UPS and FedEx split the $3.1B right down the middle, UPS will make more (better than $1.5B) than they would have with the UPS/DHL deal in the first place.
It also seems that FedEx should be glad that DHL is packing up and leaving because now FedEX is looking at splitting the $3.1B with UPS.
Now I realize that not all the old DHL accounts will convert to UPS and FedEx (some may go to the Post Office and others may not even renew at all), but even so, the loss of DHL in the marketplace will certainly allow UPS and FedEx to raise prices without DHL undercutting them any more.
Just my dirty math, but as a fairly junior UPSer, these numbers make me a little less concerned now that it seems the big UPS/DHL deal is off/stalled/whatever.
According to the DPWN's cc last week, DHL is walking away from $3.1B a year in domestic USA revenue by January 31, 2009.
Knowing that the deal between UPS/DHL was supposed to be for $1B a year, it now seems that if UPS and FedEx split the $3.1B right down the middle, UPS will make more (better than $1.5B) than they would have with the UPS/DHL deal in the first place.
It also seems that FedEx should be glad that DHL is packing up and leaving because now FedEX is looking at splitting the $3.1B with UPS.
Now I realize that not all the old DHL accounts will convert to UPS and FedEx (some may go to the Post Office and others may not even renew at all), but even so, the loss of DHL in the marketplace will certainly allow UPS and FedEx to raise prices without DHL undercutting them any more.
Just my dirty math, but as a fairly junior UPSer, these numbers make me a little less concerned now that it seems the big UPS/DHL deal is off/stalled/whatever.
11-15-2008, 07:23 PM
#2
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Maybe ALPA knew something and was actually working hard to kill the deal between UPS/DHL for FedEx the entire time rather than simply trying to save the ASTAR jobs. Nah, that couldn't be.
Sure worked out well for FedEx huh!
Sure worked out well for FedEx huh!
11-15-2008, 07:37 PM
#3
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Winners????
I suspect market conditions and the smothering political/regulatory politics they were encountering had a big part in their decision to just dump the market share and get out of town. I hope our brothers at Astar and ABX could get a piece of the action and save their jobs. These are hard times for the global market and it is difficult to determine who will survive. Who could have ever guessed 30 years ago that Ford and GM are the bottom dwellers in the automotive business. Hate to predict the future of cargo pilot careers given cheap foreign labor and business models without the burdens of retirements, medical coverages, etc. Better have a backup plan for employment and retirement.
11-15-2008, 08:00 PM
#4
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"Maybe ALPA knew something and was actually working hard to kill the deal between UPS/DHL for FedEx"
ALPA? I think you're grasping at some really long straws. Whatever makes you happy. If you want some credibility with that, you might want to cite some sources or put up some links.
ALPA? I think you're grasping at some really long straws. Whatever makes you happy. If you want some credibility with that, you might want to cite some sources or put up some links.
11-15-2008, 08:52 PM
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Originally Posted by de727ups
If you want some credibility with that, you might want to cite some sources or put up some links.
UPS and FedEx flying DHL packages must not be, I guess, because I haven't heard Prater making a stink anymore. Things that make you go hmmm.
As for your 'links' for credibility, I guess I'm the first poster ever on this board to speculate about something?
11-15-2008, 09:04 PM
#7
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Originally Posted by FR8K9
Prater testifying in front of congress that UPS flying DHL packages was anti-competitive might be a clue.
UPS and FedEx flying DHL packages must not be, I guess, because I haven't heard Prater making a stink anymore. Things that make you go hmmm.
As for your 'links' for credibility, I guess I'm the first poster ever on this board to speculate about something?
UPS and FedEx flying DHL packages must not be, I guess, because I haven't heard Prater making a stink anymore. Things that make you go hmmm.
As for your 'links' for credibility, I guess I'm the first poster ever on this board to speculate about something?
Sneaky f-in Germans. Hose the state and cut payrolls while looking good in the process.
11-15-2008, 09:11 PM
#8
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"because I haven't heard Prater making a stink anymore. Things that make you go hmmm."
Not so much hummm....as I see it. More that it's not an issue at this point.
"As for your 'links' for credibility, I guess I'm the first poster ever on this board to speculate about something?"
No, you aren't the first poster at this board who's speculation lacks credibility. Welcome to the club.
I just think you're shooting from the hip, for effect. I think that sucks.
Not so much hummm....as I see it. More that it's not an issue at this point.
"As for your 'links' for credibility, I guess I'm the first poster ever on this board to speculate about something?"
No, you aren't the first poster at this board who's speculation lacks credibility. Welcome to the club.
I just think you're shooting from the hip, for effect. I think that sucks.
11-15-2008, 09:21 PM
#9
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I suspect market conditions and the smothering political/regulatory politics they were encountering had a big part in their decision to just dump the market share and get out of town.
I think the more they looked at this market, the less they liked their chances of turning a profit - just like MadPuppy said above. "You have to know ... when to fold 'em". They folded. Purple and Brown, plus regulations against foreign ownership, were just too much. I couldn't believe they bought in in the first place.
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