DHL parent poised for job cuts in U.S.
Germany’s Deutsche Post is poised to announce thousands of job cuts at its DHL Express operations in the United States, possibly as early as today, a person familiar with the decision said.
The person said Sunday on condition of anonymity that the Bonn-based express mail and logistics company was ready to announce that the cutbacks at its DHL operations in the United States would affect 12,000 to 13,000 jobs.
The cuts are part of a wider plan to curtail operations in the U.S., including ground deliveries, and would probably affect drivers, shipping clerks and warehouse workers. The express unit employs 18,000 workers.
The expected move will not signal Deutsche Post’s exit from the U.S., where it competes with UPS Inc. and FedEx Corp. The person said the company’s U.S. logistics unit, which employs 25,000 people, would not be affected and some staff at DHL would remain.
Deutsche Post said this year that competition, rising fuel prices and other factors had put its U.S. DHL operations on track to lose $1.6 billion by the end of the year.
In May, Deutsche Post Chief Executive Frank Appel announced a restructuring of the U.S. operations, which have posted recurring losses. At the time, Appel said the company’s U.S. freight flights were to be taken over by rival UPS Inc.
In May, UPS and DHL proposed a collaboration in which UPS would carry some air packages for DHL. The deal, if completed, could last up to 10 years and infuse up to $1 billion in annual revenue for UPS.
UPS has said the contract would mostly involve the transport of DHL packages among airports in North America -- not the pickup or delivery of DHL packages to customers.
Thousands of jobs could be lost at an air cargo facility in Wilmington, Ohio, if the agreement between DHL and UPS is consummated.
Deutsche Post slashed its earnings forecasts for 2008 and 2009 late last month, saying it expected pretax profit to fall 8% in the third quarter “as the global economic environment deteriorated markedly.”
Deutsche Post is scheduled to release its third-quarter results today.
