DHL Express is cutting back its U.S. operations more deeply than earlier announced as it copes with a troubled American economy.

DHL also says it is speeding up the cutbacks it had been planning, putting its cost-saving efforts on a more urgent track and prompting suggestions from some industry observers that even greater cuts in DHL's presence in the United States are on the way.

Jon Langenfeld, an investment analyst with Baird Equity Research, said his firm's industry contacts "suggest that deteriorating conditions could force DHL to more drastically eliminate its U.S. domestric parcel operations."

DHL late Friday issued a statement saying the company has "identified additional rationalization measures" to support its overall restructuring and that it has "hastened the pace of many of our cost savings initiatives."

The company says the efforts are aimed at "sustaining DHL's business in the U.S. market and stem our ongoing losses"

A key part of the restructuring effort has not gone forward, however. DHL said in May in announcing the restructuring that it would outsource its flight services in the United States to UPS and hoped to have a 10-year contract for the business completed by the end of August. DHL officials did not respond to questions about the contract talk; UPS officials said the talks were still going on. 

DHL recently trimmed some of its service offerings, dropping the DHL@home hybrid postal/private delivery option that had been launched by Airborne Express several years ago.

Courtesy of Postcom.org