DHL Express to nix UPS deal, jobs, close all ground hubs

DHL plans to proceed with 7,400 job cuts in Ohio.

DAYTON (AP) — DHL Express said Monday it intends to reduce U.S. operations and proceed with plans to strike a deal with fellow package-delivery company UPS, all but dashing hopes of saving thousands of jobs at DHL’s operation in Wilmington.

Wilmington Mayor David Raizk said the move is disappointing but not unexpected.

“While we hope for the best, we have been preparing for the worst,” Raizk said.

DHL wants a deal to hire UPS and replace ABX Air and ASTAR Air Cargo in transporting packages by year’s end. That would move work away from DHL’s hub in Wilmington, about 30 miles southeast of Dayton, and result in the loss of about 7,400 jobs there.

DHL Express CEO John Mullen said that if the company reaches a deal with UPS, the work at Wilmington could be moved in early 2009.

Mullen said the only possibility that DHL will maintain a presence in Wilmington is if the deal with UPS falls through. In that case, he said, DHL would likely continue to use ABX Air and ASTAR, but those companies would be transporting far fewer packages.

“This is heartbreaking news for the city of Wilmington and southwest Ohio,” Gov. Ted Strickland and Lt. Gov. Lee Fisher said in a statement.

“We will now focus on doing everything we can to help the affected workers, their families and their communities.”

DHL spokeswoman Michele Nadeem said the Wilmington hub will continue to operate for now and will be affected only by an expected decrease in the volume of package shipping from the repositioning of the business. DHL’s domestic volume is expected to fall from 1.2 million shipments a day to 100,000 on Jan. 30.

DHL parent Deutsche Post AG said Monday that heavy losses and fierce competition is forcing it to significantly reduce its air and ground operations in the United States and cut 9,500 jobs within the country.

Wilmington officials had hoped that DHL would at least maintain its facility that sorts packages for ground transport, an operation that employs hundreds of workers. However, DHL said it plans to close all of its ground hubs.

ABX Air manages the ground freight for DHL at the Wilmington hub and at 15 hubs across the nation.

“This will impact about 2,000 more ABX Air people,” said ABX President John Graber. “We are working as quickly as we can to get them the details they need.”

Raizk said he is holding out hope that DHL will continue to make and process international shipments at Wilmington even if a deal with UPS is reached. That would result in some jobs being saved.

“Whatever jobs there are, that’s better than zero,” he said.

Mullen said DHL is willing to turn over ownership of the Wilmington air park and is in discussions about that possibility. Raizk said that will be the first step in redeveloping the site.

“We’re not going to have a ghost town,” Raizk said. “We’re all going to pull together to make something work.”