Eric Joiner's Freightdawg.com - The Logistics and Supply Chain Blog!

The Mystery of Larry Hillblom - a DHL Founder

DHL today is a 64 billion dollar logistics company spanning the globe in movement of everything from envelopes to customer chartered jumbo jets.  Now a part of German conglomerate Deutsche Post,  few people know the history of the 3 Americans who founded the company in San Francisco, Ca. in the late 60's.  

A lot of people think DHL stands for something German, but in fact, it represents the names of the three founders.  Dalsey, Hillblom and Lynn.   

Larry Hillblom is probably the most infamous of the 3 amigos for the simple reason that once the company became successful in transportation of international documents, primarily shipping line manifests before the age of electronic media, he became an international playboy.  Hillblom moved to Asia, fathered multiple children and then died a mysterious death in a plane crash.   

The article below, from Fortune Magazine, reviews a new book on Hillbloms life.  I am surprised its not a major motion picture.  60 Minutes did a report on Larry Hillblom and his multiple illegitimate children some time ago.  

DHL today has nothing to do with the historical roots of the three American founders, but the history itself is interesting reading. 

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FORTUNE -- Growing up fatherless on a peach farm in California, Larry Hillblom told friends he wanted to be like Howard Hughes some day. He came closer than anyone could have expected. Hillblom went into business, amassed a huge fortune, acquired an airline, built a secretive empire, sustained hideous injuries in a plane crash, and developed into a full-blown germaphobe eccentric.

For all that, there was an important difference between the two men. Hughes indulged his whims in Hollywood and Las Vegas, becoming an object of public fascination. Hillblom cut his wackadoodle swath across Micronesia, which is why you may not have heard of him.

Hillblom was the "H" in DHL, the international courier service, and is the subject of King Larry, a biography by James D. Scurlock. The author unquestionably has a nose for a good story. In 2006, two years before Lehman Brothers collapsed, he made a jeremiad movie called Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders. He published a book by the same name the following year.

With his new book, Scurlock has again hit upon a story that was crying out to be told. Hillblom, it seems, was a business monster -- a man with an unquenchable work ethic and no discernible moral compass. His principal hobby seems to have been deflowering virgins. A billionaire cheapskate, he was passionately devoted to a cause: shielding his money from the IRS. As soon as he had DHL up and running, he moved to Saipan, a U.S. protectorate with disputed (or at least disputable) tax regulations. There, dressing like a surfer and riding around in a DeLorean, he disported himself with breathtaking self-indulgence for 14 years.

via Click Here to read more of the original Fortune article

Japan Radiation Threat Causes Cargo Screening and altered Operations

Everyone is watching and reading the News about the terrible after effects of the earthquake and Tsunami that hit Northern Japan and the subsequent explosive impact on several Japanese nuclear power reactors.  

As the Japanese struggle with the health and safety of their own people,  foreign governments including the United States are carefully watching cargoes and people transiting or originating from Japan.   So far, the US Customs and Border Protection (CBP) department issued the following statement on March 16th, 2011. 

"U.S. Customs and Border Protection (CBP) is monitoring developments in Japan carefully and is specifically assessing the potential for radiological contamination associated with the ongoing impact of the earthquake and tsunami to Japan's nuclear facilities. Out of an abundance of caution, CBP has issued field guidance reiterating its operational protocols and directing field personnel to specifically monitor maritime and air traffic from Japan. 

No aircraft entering the United States today tested positive for radiation at harmful levels.

To address radiological and nuclear risks, CBP employs several types of radiation detection equipment in its operations at both air and sea ports, and uses this equipment, along with specific operational protocols, to resolve any security or safety risks that are identified with inbound travelers and cargo.  In the air environment, CBP frontline personnel are equipped with Personal Radiation Detectors (PRDs) that can detect the presence of radiological materials, and all airports have more sensitive Radiation Isotope Identification Devices (RIIDs) to determine both the presence and type of radiation encountered. Travelers who manifest signs of radiation sickness are referred to health authorities and provided appropriate treatment.

At seaports, and in its international mail and express consignment facilities, CBP continues to use sensitive, large-scale Radiation Portal Monitors (RPM) and scans all maritime cargo and express consignment and mail arriving from Japan. CBP maintains similar protocols for identifying and resolving radiation alarms in these operations and will deny entry to contaminated cargo and mail. 

CBP will continue to evaluate the potential risks posed by radiation contamination on inbound travelers and cargo and will adjust its detection and response protocols, in coordination with its interagency partners, as developments warrant."

While the US government has discouraged citizens from visiting Japan, so far no passengers or luggage have shown signs of radioactive contamination.   Airlines are taking a wait and see attitude toward servicing Japanese airports.  Delta Airlines as an example is still servicing Narita airport but at present has ceased flights to Haneda.    Lufthansa however has not resumed flights to Narita so far.   Express carriers are continuing to serve Japan at varying levels with FedEx, DHL and UPS all making service announcements on their web sites.

Major container terminals are presently working at normal capacity, however port closures over the past weekend have caused congestion and backlogs.  It remains to be seen if the ports are impacted as days go on by lack of diesel fuel and gasoline, as well as inability of workers to get to work due to power and public transport disruptions.  Services to Sendai, Hachinohe, and Onahama have been suspended by some carriers including Maersk.   NYK Line, a leading Japanese flag carrier meanwhile has offered its services to the Japanese government not only in moving relief supplies, but in providing service vessels to serve as offshore staging platforms for helicopters and relief supplies. 

Auburn Tigers: 2011 NATIONAL CHAMPIONS!!!

Ok this is a logistics blog, but not tonight.

 Tonight something incredibly special happened. Auburn University and their football team won the BCS National Championship 22-19.

I am 49 years old and an Auburn grad. We never saw this season coming.  We knew the football team would be good and that recruiting was going well. However, we had not heard of this guy named Cameron Newton.  Same guy who won the Heisman Trophy and lead AU to the SEC Championship and the National Championship. 

   So BIG UPS to Auburn.  And BIG UPS to all Auburn Fans.    Nobody can deny the fact that Auburn can handle the big show.  

I graduated from Auburn in 1984,   I am so proud of our kids.  WAR EAGLE!!!

Eric

 

An Old Dawg Talks about New Tricks. 2011 awaits.

My friend and former colleague Jerry Hempstead spent 32 years in the parcel business.  He "retired"...and I use that term loosely... in 2006.  In the meantime Jerry and his consultancy practice have been busier than most non-retired people I know.   Jerry possesses a passion for people, intellect for our business and street savvy that make him simply fun to be around if you are a freightdawg like me.  

I've been working in this field for 25 years and I learn every time I talk with Jerry.   Below he shares his thoughts for 2011.  This will be a challenging year in rebuilding the global economy.  Logistics players will be challenged across the board, ranging from carriers to 3PL's and forwarders to the integrators.   Nothing is as it was.

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I get a lot of what I would call "negative mail". Items that complain about the decisions being made by politicians. The state of the economy, the housing crisis, the dollar, our taxes and so on. Taken without context, its enough to make one depressed.

Today we are on the verge of entering a brand new year. Most who know me, realize right away that I'm an optimist. Just ask me how I'm doing when you call me... you'll know immediately.  I believe that no matter how bad things are,  I have a daily obligation to determine how I will relate to you. I choose to do so positively.

My life's passion is Logistics.   When I think about it and the future, I get excited.   I've been doing this for years, and I remain motivated about our field of endeavor. While I am retired from the firm I served for many years, I remain active in the industry I love as a consultant, enthusiast and confidant of supply chain professionals worldwide.

I'm a parcel guy first and I remain amazed at our postal system. We in the United States have the greatest postal service on the planet. I have lived overseas and can attest that our service is second to none, when you consider that every citizen has the right to home delivery six days a week. The Postal Service is actually one of the few things our Constitution says the government must provide.

The United States Postal Service employs over 500,000 people. Relative to any other postal service, ours is a bargain. $.44 for one to three day service just about anywhere in the USA is amazing. I think its the most complex logistics provider on the planet when you consider all the classes of mail, the number of pieces they handle and the myriad of sizes and shapes they transport.

As weird as it sounds, the USPS is one of the biggest customers of FedEx and UPS. Conversely two of the largest customers of the USPS are FedEx and UPS. I suspect that FedEx Smartpost gives the USPS more parcels today than any other mailer, and Smartpost has been the fastest growing FedEx service.

Two of the largest logistics players in the parcel world are U.S. companies FedEx and UPS. Take a look at how these two firms performed financially in 2010.  Fedex stock rose by 11% year to date and UPS is up 26%. I think between the two there are over 600,000 people employed globally. We can be proud of both these companies and be thankful they are American flag carriers.

I thought about our road system after seeing a television program on how our infrastructure is crumbling and that we are in crisis. I spend a lot of time "on the road", both here and abroad, and I can share with you that with all its faults our interstate and local road systems are the best there is in the world.

I have been on every continent except Antarctica and I can say that we are blessed to have the network we have today. No other country has invested like we have in our roads, with the possible exception of Germany. We have the most available and largest domestic trucking industry in the world and a workforce that for all its issues generally cares for the customer and about their mission in the transport and delivery process.

The United States has more technology, more ports, more rail track and more modern and sophisticated aviation infrastructure than any other country.  We are blessed.

I have had the opportunity to work for over three decades with a group of people who have passion for their work and for building enterprises that offer services that delight customers. I've witnessed incredible, exciting changes over those decades that have increased the speed, visibility and the consistency of the services being offered. Most of all I have shared my life with a community that has a tremendous work ethic and a wonderful sense of camaraderie that the logistics industry seems to engender.

I have made lifelong friends as a result.

So as we enter 2011 let's focus not on what the press is saying about how bad things are, and let's get to work making a difference each and ever day to make the situation better. Even if its just the pride at the end of the day, that you did your best and for those tasks to which you were assigned that day, you made a difference.

Do these Eight things in 2011.  They will not only improve your business, but your life.

1. Make every encounter with your peers, your customers, your family, your friends a positive one. Brighten up a room when you enter and not when you leave. 


2. Make an effort every day to improve yourself. don't let time get wasted away without content. Use the commute to listen to a book on tape, read a book or article, for goodness sake, what you are thinking is important, write an article. This will make you more valuable to your employer or when you might be seeking new employment or a promotion.


3. Dress like you care about how you look. People make judgements based on first impressions. Sorry but that's just life. Always look like you are enjoying the experience...over time you will.


4. Everyone wants to be assured that they are important, worthwhile and accepted. This includes your family and your colleagues. Take the time to send an email or better yet call or speak face to face and tell them they did a good job, or that you really appreciate something they did.  You will make friends for life.


5. Focus on doing the right things, doing them right and not having to do them over. Do everything as if your job depends on it. Have a sense of urgency and a sense of pride in what you produce. Be thankful you have meaningful work and know there are 400 people out these that would love to have your job (no matter how bad you think your job might be).


6. Get involved. if you are in the freight/logistics business you are remiss if you are not at least attending the local roundtable events hosted by CSCMP. There are other inexpensive and or free organizations that will expand your circle of contacts and if you pay attention will increase your knowledge of the business. Organizations like Toastmasters will help you in may ways to improve who you are and how you communicate and also make you some great friends.


7. Know what's going on with federal and local issues that impact your employer and your continued employment. Then get involved. You can communicate for free with your elected officials. Believe it or not,they keep track of what constituents are saying. You can be on the bus or under the bus. Your choice.


8. You are bright, intelligent, articulate, and motivated if you got this far in the article. Take that power and create a mission for yourself for 2011 and then put it on an index card and post it on your bathroom mirror. Make a decision that 2011 is going to be the best year of your life. List those things that are important to you and to which you will actually devote some time and create one or more things on your bucket list to accomplish in this coming year. My wife has always wanted to go to Poland, the land of her fathers ancestors. Number 1 on our list for 2011 is to get to Eastern Europe. What do you think my odds are of getting that accomplished?

Happy New Year

Jerry

Runway Girl!

Ok, I'm digging this.  People will blog about anything, but with as much as I fly, I am now amazed to have run across a blog that covers Inflight Entertainment Systems (IFE). 

Mary Kirby's Runway Girl site is part of Flightglobal.com and covers professional news and reviews of various systems from major IFE manufacturers.   Believe me when you are trapped in row 41 in a middle seat for 10 hours on your way back from Buenos Aries to Atlanta, the Inflight entertainment can be a bridge to sanity (or at least take your mind of the posterior numbing discomfort.)  It's nice to find a site that covers these things.

I do consider IFE when I am booking an airfare when traveling internationally.  As an Example, between Sao Paulo, Brazil and Buenos Aries, Argentina, you can fly 2 or 3 air carriers.  Aerolineas Argentinas is the Argentinean government owned carrier (and flies and acts like one.) while TAM is the major Brazilian carrier on the route (now owned by LAN).   TAM flies new A330's with some awesome IFE systems.  Its a 2.5 hour flight, and I think I spent an hour playing with the controls on the system.   The airfare was basically the same, so why not choose the carrier with the best amenities?

Eric

 

Southwest Airlines: Coming to the ATL!

As a regular passenger on Delta Airlines out of Atlanta, I was super pumped to read that Southwest is purchasing Airtran.  Airtran has built a nice base of operations in Atlanta and is really the only major domestic carrier competition Delta has in this Market.   

Deltas dominance keeps airfares in our market higher than in more contested markets, especially to 2nd tier markets like Columbus Ohio,  Charleston, SC. etc.    Airtran has provided competition but not on the order, service consistency or market reach of Southwest.   For those of us who feel locked in,  now our choices are growing.  This is great news.

Operationally, it will be interesting to see how SWA integrates Airtrans fleet into its all B737 fleet.  Airtran operates both Boeing 717's as well as 737's.   The 717 fleet is relatively new, but I would not be surprised to see SWA liquidate that portion of the Airtran fleet over a near to medium term. 

This acquisition does nothing for the air freight market.  In this regard, I wish Delta had some more international competition, especially on South American routes where it pretty much owns the markets to Brazil, Argentina and Mexico.   Anything that would force Delta to upgrade it's inadequate old 767's on these routes would be a plus.

Airtran has built a competitive, quality discount air carrier.  Adding their talents and assets to the already great Southwest Airlines is a major boon to the Atlanta market and anywhere else served by Airtran. 

JetBlue Flight Attendant Blows a Gasket.

Flight attendant curses out passengers, slides down emergency chute | NWCN.com | NWCN - News

 Frankly I am not surprised that a flight attendant finally had enough. These folks routinely get abused by fed up passengers suffering from delayed flights, too small aircraft, ineffective luggage policies and frankly...militant (harassed) flight attendants.  And this is all after having run the TSA gauntlet just to get to these problems. 

I'm surprised fisticuffs were not involved.  At least the guy exited with a little flair.  Using the emergency exit was a guaranteed loss of job plus FAA and legal complications...but hey...the guy got home early. 

This is all dandruff falling from the heads of airline and government management of today's airline market. 

Lufthansa MD-11F Crash at Riyadh, Saudi Arabia

On Tuesday, July 27th, 2010, a Lufthansa MD-11 Freighter bound from Frankfurt, Germany to Riyadh, KSA crashed on landing destroying the air frame, however without loss of life.  LH8460 was subsequently scheduled to fly from Riyadh to Sharjah then on to Hong Kong.   Lufthansa only operates the MD-11 as a freighter. 

The MD-11 suffers from a bad reputation given its few numbers built (200 aircraft).   Of the 200 built, now 8 have crashed.   Three of those were FedEx freighters. Compared to other wide body jets this number of crashes is very high.  

Here are some comparisons to other aircraft currently flying.

• MD-11: 8 crashed out of 200
• B744: 3 crashed out of approximately 700 (166 pure freighters built)
• A340: 3 crashed out of approximately 390+
• B777: 1 crashed out of 860+

Previous MD-11 crashes are detailed here.

• 31-JUL-1997 MD-11F N611FE FedEx
• 02-SEP-1998 MD-11 HB-IWF Swissair
• 15-APR-1999 MD-11 HL7373 Korean Air
• 22-AUG-1999 MD-11 B-150 China Airlines
• 17-OCT-1999 MD-11F N581FE FedEx
• 23-MAR-2009 MD-11F N526FE FedEx
• 28-NOV-2009 MD-11F Z-BAV Avient

I'll be honest...if I was a FedEx pilot I'd be working on getting a rating to fly something else.  I have friends who are Delta pilots who "inherited" the MD-11 when DAL purchased other airlines.  There were always complaints that this aircraft was complicated to fly and was less-than-intuitive when it came to systems.  Most were not unhappy to see these birds retired.  

I will say as a passenger, I never liked the MD-11's older sister, the DC-10.  When American had the horrific crash at Chicago ORD many years ago, that crash scared me.   I always flew on the L-1011 because I thought it was a safer bird.   The MD-11 is a derivative of the DC-10. Perhaps the recent crashes are not linked, but as a guy who rides in back...I pay attention.

Lufthansa is still sorting out the freight manifest for this flight and as far as I know, no losses have been formally confirmed to freight forwarders or shippers with freight aboard.  That, I am sure is coming, but so far nothing has been put forward by the airline that I am aware of.

Eric

N836D: First of the Last

The Historical Flight Foundation, located in Opa Locka Florida, operates what is today the last flying example of the famous Douglas DC-7. This DC-7B was once operated by Eastern Airlines.  After meticulous and costly restoration, this old girl finally got off the ground on July 4th, 2010. She will now be making the air show circuit in the USA.

Guess what?  You can fly on her.   The HFF will be selling seats for passengers once the aircraft starts making her rounds.  She will be seen at Airventure in Oshkosh, Thunder over Michigan and coming up in August, Teterboro Airport in New Jersey.    Check out this Google slide show as well for interior pictures.  She is a beauty.

Ok, these things are CREEPY.

I spent the last couple of days in south Florida in some customer meetings.   I normally fly into KFLL, pick up a rental car, go to our corporate headquarters to visit my amigos, then go do what I need to do with the Latin American regional offices of my clients that are based in Miami.   This is all quite normal and regular business for me.  

On the return to Atlanta tonight, going through TSA security at Fort Lauderdale, I noted that they had a new (at least since the last time I was there) scanning unit in terminal 2.  It is a backscatter body imaging machine.  These are the units that can see through the clothing of scanned passengers, though said not to either store scans nor compromise the modesty of the scanned passenger. (see for yourself here.)

Since I work with customers who produce some of these kinds of security devices,  I figured I would go through the body imaging line.  No big deal really.  You take off any and all metal, then you proceed to hold your arms up and get scanned.  The TSA officer then tells you to move along.   However, I will say watching a young lady in front of me get scanned, then subsequently get frisked, gave me the willies.  The TSA officers did nothing unusual and were perfectly professional in the examinations. Standing in the unit, then holding your arms up to get scanned, was somehow just a little unnerving.   After a few times, I'm sure it will seem quite normal, but I can think of a few things that might seem normal if you did them enough.

Here is what the TSA says about those who observe these screenings:

"For additional privacy, the officer viewing the image is in a separate room and will never see the passenger and the officer attending to the passenger will never see the image. The officers have 2-way radios to communicate with each other in case a threat object is identified."

Why is this even more unnerving?     I do not want to even know what those people could be doing in the observation rooms, though I can pretty much assure the traveling public my image won't incite anything weird.

I really think it's time to go to a US domestic passport along with some kind of bio marker that says it's me.  Maybe a retina scan or a fingerprint scan, but something that shows I am a safe traveler and something that expedites travel through security. I am convinced that at least one true cost of 9/11 is being borne and costed out on the traveling public by the inefficient use of security measures.   

Politically, I am a center right independent.  Mostly I just want to be left alone by government to pay my own way, take care of my responsibilities and do my own thing.  Most conservatives rail at the idea of any kind of domestic passport on the grounds that it is like Nazi Germany "requesting your papers" just to travel in your own country.  

On a defacto basis I think we are already there.  We are just using technology to verify who is safe and who is not.

Stop screening my shoes and my underwear.   Neither of which is really that interesting.

Eric