Air Transport Services Group, Inc. (NASDAQ: ATSG), today announced that its subsidiary ABX Air has been notified that DHL, its principal customer, will discontinue a substantial portion of its U.S.-based domestic express package operations effective January 4, 2009.
ATSG said that DHL intends to close its sorting operations at its U.S. regional hubs, and all domestic daytime package sorting operations except a Sunday day sort operation on that date. Night-time sorting operations will continue in Wilmington.
The closure of these operations will result in the reduction of approximately 1,900 ABX Air positions, including about 1,000 positions in Wilmington, Ohio. The reductions will affect every department of the company. Notifications to affected employees will begin next week.
DHL also notified ABX Air that it will no longer require the use of ABX Air’s DC-9 aircraft after January 2009.
“We have known that this day was coming since DHL announced on November 10 that it would pull out of the U.S. domestic express package market, but it is still a very difficult time for our loyal ABX Air employees who have worked very hard for DHL and its customers,” said Joe Hete, President & CEO of Air Transport Services Group. “Despite this action, however, ABX Air is still in the cargo airline business. DHL has indicated that it wants ABX Air to continue operating most of our Boeing 767 aircraft currently flying under the DHL contract, at least through June 2009. ABX Air also will continue to operate our other cargo aircraft for our charter and ACMI customers.”
ATSG is a leading provider of air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. Through five principal subsidiaries, including three airlines with separate and distinct U.S. FAA Part 121 Air Carrier certificates, ATSG also provides aircraft leasing, aircraft maintenance services, airport ground services, fuel management, specialized transportation management, and air charter brokerage services. ATSG’s subsidiaries include ABX Air, Inc., Air Transport International, LLC, Capital Cargo International Airlines, Inc., Cargo Aircraft Management, Inc., and LGSTX Services, Inc. For more information, please see www.atsginc.com.
Except for historical information contained herein, the matters discussed in this release contain forward-looking statements that involve risks and uncertainties. There are a number of important factors that could cause the company's actual results to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to, the rate at which DHL reduces the scope of services under the ACMI and Hub Services Agreements between ABX Air and DHL and other factors that are contained from time to time in ATSG's filings with the U.S. Securities and Exchange Commission, including the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Readers should carefully review this release and should not place undue reliance on the company's forward-looking statements. These forward-looking statements were based on information, plans and estimates as of the date of this release. ATSG undertakes no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.
Quint Turner, 937-366-2303