ABX Air declared Friday that DHL is "in default" of its contracts with the Ohio-based airline that transports cargo throughout the US for the express giant. ABX has both an ACMI and a hub and line-haul service agreement with DHL under which the latter reimburses the former for many of the expenses incurred while conducting DHL business. But the contracts stipulate that the reimbursements are reduced substantially if ABX's total revenue from non-DHL operations exceeds 10%, and DHL claims that threshold has been topped.
ABX said in a statement that DHL's calculation is flawed, insisting revenue generated from non-DHL operations is below 10%. President and CEO Joe Hete added that the decision to file documents formally with the US Securities and Exchange Commission alleging contract default "was taken only after intensive efforts on our part to resolve this issue directly with DHL." Despite the dispute, he said ABX "is today and intends to remain DHL's principal US business partner."