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Published: 9/17/2011 - Updated: 2 years ago

DHL lease OK'd by port panel

Cargo firm is likely to bring 9 weekly flights into Toledo

BY DAVID PATCH
BLADE STAFF WRITER
Toledo-Lucas County Port Authority committee Friday approved a 3-year, month-to-month lease with DHL Express (USA, Inc.). Toledo-Lucas County Port Authority committee Friday approved a 3-year, month-to-month lease with DHL Express (USA, Inc.).
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BAX Global may be gone from Toledo Express Airport, but some of the freight it formerly handled there isn't.

A Toledo-Lucas County Port Authority committee Friday approved a three-year, month-to-month lease with DHL Express (USA) Inc. for about half of the Air Cargo Building on the airfield's north side. The facility will be used to move transfer freight, with nine weekly flights expected to stop at Toledo Express and DHL-affiliated trucks routed to Toledo, Detroit, and Grand Rapids, Mich.

The operation will employ about 25 people in a mix of full-time and part-time positions at its start on Monday, Airport Manager Steve Arnold told the port authority's airport committee. Integrated Airline Services, a DHL contractor, will run the facility.

Port President Paul Toth said DHL had, since spring, flown Michigan freight in and out of Toledo by booking space on BAX Global flights. When BAX Global announced it was shutting down its Toledo cargo hub on Sept. 1, DHL considered returning the traffic to Detroit Metropolitan-Wayne County Airport, but has been persuaded to stay in Toledo, he said.

"It's good to get some good news out there," Jerry Chabler, the airport committee's chairman, said after hearing Mr. Toth's report.

The port authority's full board of directors is scheduled to vote Thursday on the DHL lease, but Mr. Toth said the company could establish its local operation before then based on a schedule of airport lease rates and landing fees already approved by the board.

Mr. Toth predicted the DHL operation would generate $200,000 in annual revenue to the port authority, including aircraft landing and apron-use fees.

BAX, the former Burlington Air Express, pulled out of Toledo Express after 20 years at the local airport, during which it operated as many as 44 flights per weeknight and employed more than 800 people. Parent company DB Schenker attributed the closing to fundamental shifts in freight handling that favor ground transport over air cargo for an increasing share of the market.

Domestic operations at the hub had already declined to 19 flights, five nights a week, and employment had declined to about 700, mostly part-time, workers, when the closing was announced.

Mr. Arnold said Friday that among DHL/Integrated Airline Services employees to whom he had issued security badges, "a lot of them are ex-BAX employees."

DHL is no stranger to air-cargo industry contraction. In early 2009, it shut down a massive cargo hub and distribution center in Wilmington, Ohio, that had employed 7,000 people and moved its remaining international cargo operations back to a site at the Cincinnati airport it had previously vacated after buying Wilmington-based Airborne Express.

Mr. Toth said DHL's new Toledo flights will connect with DHL's overseas planes at Cincinnati and stop here en route to and from Minneapolis-St. Paul.

The Air Cargo Building is separate from the BAX hub on the Toledo Express airfield's south side. DHL plans to lease 4,291 square feet, or somewhat less than half, of the building for cargo-handling space, offices, and equipment storage.

It also houses customs offices and additional warehouse space that the port authority renovated and equipped for cold storage in 2005.

Schenker's lease on the cargo hub expires in 2013, with the port authority liable for $9 million in bonded construction debt that would remain unpaid thereafter. Mr. Toth said negotiations continue with Schenker to terminate the lease before then, so that the port authority can actively market the hub complex to other prospective tenants.

"We think there are other opportunities" to develop air-cargo traffic at Toledo Express, particularly on the international front and especially "once we get control of the BAX hub," the port president said. "We continue to make progress" in the lease-buyout talks, he said.

Contact David Patch at: dpatch@theblade.com or 419-724-6094



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