DHL cuts 2,850 US jobs

Courier firm DHL is to lay off 2,850 of its 44,000 US staff in the wake of its $1.12bn (£710m) takeover of Airborne Inc last month to help fill in gaps in its network.

The work carried out by the staff at 169 centres across the US will immediately pass to Airborne staff, although 76 other DHL centres will continue to operate.

The move, DHL said, would save about $87m a year.

The staff - including couriers, mechanics and office workers - will be paid to the end of October.

The merged group, which is owned by Deutsche Post and is headquartered in Brussels, has yet to decide which of DHL's Airborne's flight hubs - both in Ohio - it is to ditch, a move which will result in further job losses.

Since DHL is owned by a non-US company, it has had to spin off Airborne's flight operations into a separate company.

The new company, ABX Air, will be owned by Airborne's current shareholders, to avoid falling foul of the US's law banning foreigners owning more than 25% of a US airline.

In court

That will not affect the running of the business, since the same has applied to DHL's own air unit - now called Astar after a recent management buyout - for some years.

But the Astar deal has got DHL into court, the result of a Congressional decision following lobbying by its chief US rivals UPS and FedEx.

They say that since DHL gives Astar most of its business and guarantees it a minimum 7% return, that means Deutsche Post effectively controls the airline.

But Astar's new owners, an investors' consortium led by Chief Executive John Dasburg, say they intend to branch out into new business - and that the guarantees were perfectly routine.

"If George Washington bought the company today, (FedEx and UPS) would still try to prove it was foreign-owned," Sandy Litvack, head of Astar's legal team, told the court in late August.