rotating14 From United States of America, joined Jan 2012, 374 posts, RR: 0 Posted (4 months 2 weeks 1 day 21 hours ago) and read 5465 times:
So I ran into an airplane mechanic for a major air delivery company and we talked about the various types of frames that fly here into ANC. I mentioned the Southern Air 777's and how often they fly into ANC and the individual told me that possibly FedEx and UPS are interested in Southern Air.
While I could see perhaps FedEx courting the idea, I can't see UPS doing the same since they just bought out TNT. Anybody else wanna shed light on this topic?
PHX787 From Japan, joined Mar 2012, 4952 posts, RR: 15 Reply 1, posted (4 months 2 weeks 1 day 21 hours ago) and read 5395 times:
Quoting rotating14 (Thread starter): While I could see perhaps FedEx courting the idea, I can't see UPS doing the same since they just bought out TNT. Anybody else wanna shed light on this topic?
I see neither. Who I see buying Southern Air is DHL. They already operate contract flights into CVG...why no go for the whole kit and kaboodle?
Polot From United States of America, joined Jul 2011, 1497 posts, RR: 0 Reply 3, posted (4 months 2 weeks 1 day 21 hours ago) and read 5285 times:
Quoting PHX787 (Reply 1): I see neither. Who I see buying Southern Air is DHL. They already operate contract flights into CVG...why no go for the whole kit and kaboodle?
DHL is not a US airline- they cannot have a controlling share in Southern Air. When DHL bought Airborne Express about 10 years ago their (Airborne's) airline division was spun off into a new (US) carrier, ABX Air.
LHCVG From United States of America, joined May 2009, 1368 posts, RR: 1 Reply 4, posted (4 months 2 weeks 1 day 21 hours ago) and read 5256 times:
Quoting PHX787 (Reply 1): I see neither. Who I see buying Southern Air is DHL. They already operate contract flights into CVG...why no go for the whole kit and kaboodle?
I agree with your logic on that, but I wouldn't be very optimistic about that given where DHL is right now. I'd also add the AeroLogic partnership between DHL and LH Cargo as indicative of where they are trying to find synergies. Obviously Aero flying 77F's helps here, but overall I would question whether DHL is looking to buy anyone just yet. So I would lean more toward FX or 5X if I were a betting person, but again DHL obviously could work.
Going off that, I think this is the key point:
Quoting rotating14 (Reply 2): True. Depending on the price and what's up for grabs weighs also. Taking Southerns T7's is a no brainier and its route map may appeal to FX as well.
I think the specifics of where and what Southern does in relation to what each of the three aforementioned players is interested in will be the key. FX or 5X may well find more value than you'd think in getting them.
DHL has contracted it's US operations because it was a disaster. They are not looking to expand in the us market due to the saturation that UPS and FedEx have. So no that will not be happening any time soon.
LHCVG From United States of America, joined May 2009, 1368 posts, RR: 1 Reply 7, posted (4 months 2 weeks 1 day 20 hours ago) and read 4992 times:
Quoting LV (Reply 5): I don't see what is in it for either 5X or FX buying Southern Air other than some 777s. What would make this deal worth it?
That's what rotating was getting at, and I was trying to emphasize: maybe we can't see (or haven't identified yet) the kicker for them. But they could have some value according to their own strategic plans and market considerations (where they want to focus/need to shore up, complementing/expanding current network).
blueflyer From United States of America, joined Jan 2006, 3119 posts, RR: 1 Reply 8, posted (4 months 2 weeks 1 day 19 hours ago) and read 4909 times:
And all this started from an airplane mechanic in ANC thinking that UPS and FedEx are possibly interested?
Quoting rotating14 (Reply 2): its route map may appeal to FX as well.
Southern doesn't have a route map. It is an ACMI/charter provider. It flies where its customers tell it to.
Quoting LV (Reply 5): What would make this deal worth it?
Nothing. Other than its fleet, Southern has no route authority, special privileges or unique wizardry that UPS or FedEx couldn't get on their own (for a lot less than it would cost to acquire Southern) that is if they don't have it already. If either one of them buys Southern, it is for the fleet. We should know soon whether UPS intends to use TNT's 777s or not (I think not). If UPS chooses not to, getting Southern becomes even less likely than it is now already.
Quoting LHCVG (Reply 4): DHL obviously could work.
DHL owns 49% of Polar, the most it is allowed to under current US law, and at this point uses up Polar's entire capacity (I think). It is also developing a close relationship with AAWW, the owner of the remaining 51% and also owner of Atlas Air. Atlas operates 767s for DHL on domestic, international and (soon) intra-Asia flights as well as a 747 here and there.
I would sooner see DHL enter into a deal with AAWW to operate 777s through Atlas or Polar once the contract with Southern runs out than have DHL buy 49% of Southern, and that is assuming that Oak Hill is even interested in selling.
Never said it was likely, just acknowledging that it's possible. That's why I took pains to say that I think either FX or 5X is far more likely IF they are even interested (to your point that it's all speculation anyway).
Someone83 From Norway, joined Sep 2006, 2778 posts, RR: 1 Reply 10, posted (4 months 2 weeks 1 day 19 hours ago) and read 4860 times:
Quoting rotating14 (Thread starter): So I ran into an airplane mechanic for a major air delivery company and we talked about the various types of frames that fly here into ANC. I mentioned the Southern Air 777's and how often they fly into ANC and the individual told me that possibly FedEx and UPS are interested in Southern Air.
Sorry and no offence, but why would a mechanic know about this? Sounds like galley rumours.....
PHX787 From Japan, joined Mar 2012, 4952 posts, RR: 15 Reply 12, posted (4 months 2 weeks 1 day 19 hours ago) and read 4805 times:
Quoting Polot (Reply 3): DHL is not a US airline- they cannot have a controlling share in Southern Air. When DHL bought Airborne Express about 10 years ago their (Airborne's) airline division was spun off into a new (US) carrier, ABX Air.
LAXintl From United States of America, joined May 2000, 22024 posts, RR: 51 Reply 13, posted (4 months 2 weeks 1 day 19 hours ago) and read 4805 times:
Why ??
Southern does not really have any assets. Planes are leased, and it really has no route rights on its own that cant be had by others by simply applying. Southern is nothing more then a will fly for food - ACMI operator.
So what would FX or UPS get - besides a few plane leases? They certainly don't want to run an operation on DHLs behalf.
Anyhow, FX has been cool to additional 777 in recent times. It has deferred 6 deliveries, and just weeks ago cancelled 2 others.
Quoting blueflyer (Reply 8): and that is assuming that Oak Hill is even interested in selling.
Well Southern is in Ch11 currently.
I'm sure creditors and the court would be more than happy to do whatever produces the greatest return - a DHL investment or other.
From the desert to the sea, to all of Southern California
rotating14 From United States of America, joined Jan 2012, 374 posts, RR: 0 Reply 14, posted (4 months 2 weeks 1 day 19 hours ago) and read 4731 times:
Because he's been working at the ANC hub since 1985 and has been working for Atlas/Polar for roughly about as long and while we're on the " no offense " bus, he probably knows more about what's going there than you, or I for that matter. Moving on ....
YVRLTN From Canada, joined Oct 2006, 2084 posts, RR: 0 Reply 16, posted (4 months 2 weeks 1 day 14 hours ago) and read 4244 times:
The only thing either may be interested in is waiting for Southern to go Chapter 7 and pick up anything worth picking up - which as others have said is not a lot unless they can wrest come contracts away from DHL in the process (not likely short term at least), some cheap 77F leases, maybe some experienced crew, mechanics and backroom staff and thats about it - and of the two, only FX would be interested in the aircraft.
Because he's been working at the ANC hub since 1985 and has been working for Atlas/Polar for roughly about as long and while we're on the " no offense " bus, he probably knows more about what's going there than you, or I for that matter. Moving on ....
Mergers and acquisitions are usually decided and worked on in the board rooms and head offices.....not in the cockpits, ramps, galleys and hangars
I respect both of your opinions on the subject. Remember it's a rumor. Nothing more nothing less. If it was something concrete, I'd furnish a link and we'd all know the facts instead of trading barbs about why a mechanic at the air line in question is privileged to sensitive information or not. Topics regarding Atlas and Polar, its a safe bet that he'd know more than those on the outside. Mergers, acquisitions, ect I agree with you that mechanics and others of the like probably would not.
The plan is for TNT to sell its airline division, TNT Express, to ASL Aviation just before UPS officially acquires TNT. Whether that happens or not is another matter. The EU competition commission has to render its decision by February 5, and UPS is having a hard time finding qualified buyers for some TNT assets, as the competition commission asked.
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