DHL makes further investments at CVG hub with a focus on international shipments
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Express delivery and logistics services provider DHL said yesterday it has invested $47 million to expand its Americas hub facility at the Cincinnati/Northern Kentucky airport (CVG) in an effort to meet the growing needs of its international shipping customers.
DHL said that this capital commitment will go towards a 193,000 square-foot sort facility and add about 280 jobs to the DHL CVG hub in the next year. The facility is expected to be operational by November, with other improvements to existing buildings and the purchase of material handling equipment expected to be completed by March 2013.
“The new building will provide us more space to handle heavy weight non-conveyable cargo,” said Mike Parra, senior vice president and head of operations for DHL Express Americas, in an interview. “It’s geared to meet the continued growth in package volume that we’re seeing. It should make the operation at CVG even more efficient and will provide the infrastructure needed to meet DHL’s expected growth over the next 10 years.”
With this most recent investment, DHL has now committed $105 million towards the CVG hub since establishing the CVG hub as its U.S. international hub in July 2009.
In February 2011, DHL said it would begin building on 19 acres of land leased from the CVG Airport Authority to expand its existing aircraft apron and construct nine new aircraft gates. They added that this will enable parking for nine additional wide-body aircraft that will connect the U.S. to points in Asia, Europe, and the Americas.
DHL’s U.S. business focuses on international import and export offerings in major metropolitan areas. It ceased U.S. domestic-only air and ground services at the end of January 2009, due largely to the ongoing uphill battle it faced competing with industry giants UPS and FedEx for market share.
A DHL spokesman told LM last year that this expansion was driven by the successful realignment of its business to focus exclusively on international services and growth in its import and export business, leading to “a need to continue to adjust its operation to meet the growing demands of international shipping customers.” The spokesperson added the CVG expansion positions DHL’s largest facility in North America for continued growth in package volume.
Parra said that the additional capacity this expansion will give DHL at CVG will ensure that it can get shipments off planes faster and easier, sorted and reloaded so DHL can move them on to their destinations, especially for heavy weight cargo. And he noted that DHL operates 78 flights per day to and from the CVG hub. Aircraft types include Boeing 777, 767, 757, 747, 727; McDonald Douglas DC-8-73.
As for DHL’s future plans at CVG and the U.S., Parra provided an overview of what DHL has planned.
“DHL Express is in the process of expanding our Miami Gateway,” he said. “That’s a $20 million investment. We also hope to expand our LAX gateway later this year. We also expect to continue improve our network adding new flights to meet demand, especially along key trade lanes such as between China and the Americas. In 2011, the bulk of the DHL Express capital investment was focused on network improvements, including, adding new larger, more fuel-efficient aircraft.”
About the AuthorJeff Berman Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
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