JOC Staff | Mar 31, 2010 2:38PM EDT
Cargo airline ABX Air announced a new agreement with DHL on Wednesday aimed at maintaining the carrier’s main source of revenue and clearing away uncertainty about ABX’s financial future.
ABX will operate 767 freighter aircraft for the U.S. portion of DHL’s international service under a fixed-price contract and ABX parent Air Transport Services Group said the company also will lease 13 767 all-cargo planes to DHL, a major boost to the airline’s efforts to move more deeply into international aircraft leasing operations.
The agreement follows a deep rift between DHL and ABX that grew with DHL’s decision to withdraw from domestic U.S. service. ABX had sought to diversify away from its strong dependence on DHL business but the Ohio-based airline has seen its revenue decline steeply since the DHL retrenchment.
“These new agreements clearly evidence the continuing long-term relationship between ABX Air and DHL and address the significant remaining questions relating to the impact of DHL’s U.S. restructuring on ABX Air,” said Joe Hete, president and CEO of ATSG.
“Exiting the cost-plus structure … provides us an opportunity to achieve appropriate market returns for our assets for years forward, and our customer the opportunity to lock in flexibility and excellent service at a predictable price,” he said.
Financial terms of the deal were not disclosed.
