Things are looking up for DHL Express

July 10, 2010

This month marks the first anniversary of the reopening of DHL Express' hub operations at Cincinnati/Northern Kentucky International Airport. The new operations followed the closing of DHL's money-losing domestic package service and its Wilmington hub, a move that slashed more than 8,000 jobs.

Despite the pain of restructuring, the decision to refocus on international shipments is beginning to pay off, say executives of DHL Express, a division of Germany's Deutsche Post AG. Ian Clough, DHL Express CEO, projected in a recent Wall Street Journal interview that shipments will grow up to 15 percent by next year.

Jack O'Neill, 53, vice president of operations at DHL Express and head of hub operations here, last week discussed the package express company's CVG hub and its growth plans with business reporter Mike Boyer.

WHAT INVESTMENT HAS DHL made in reopening the CVG hub?

We've invested about $50 million at the hub, which covers 115 acres with 520,000 square feet under roof. That includes a new quality control center, improvements in our software and hardware, upgrading our material handling and container handling, and expanding storage capacity for the growth we're expecting. The quality control center is like an air traffic control center where we actively monitor every shipment. If we don't get a check within an expected period of time, alerts go off and people try to understand what's going on with that shipment. That's how we begin steps to keep shipments on track.

WHAT KIND OF shipment volumes are moving through the facility?

This is our main hub for moving packages in and out of the United States. We're handling about 100,000 shipments a night - up about 15 percent from where we started a year ago.

WHAT ABOUT employment?

We're employing 1,500. That includes some of an additional 300 we recently announced we would be hiring.

WHAT'S FUELING THE hub's growth?

A couple things. One is our global experience and expertise. We're in 220 countries and handle over 1 billion shipments a year with 500,000 employees. We've got experience around the world. That's allowed us to grow the business.

CAN YOU GIVE our readers an example?

During the volcanic eruption in Iceland earlier this year our quality control center determined how we could reroute and redesign the network to provide delivery throughout Europe despite the fact that planes weren't flying all that often. The knowledge of our team and infrastructure in Europe allowed us to rapidly set up a port of entry in Spain and link it to our ground network in Europe. We didn't provide the same level of service as with our air network, but our service was only delayed about 48 hours as we set up an extensive trucking network in Europe. There was no shipment backlog. I don't know what our competition did, but what I heard from our customers was that we exceeded their expectations.