DHL expands cargo 'super hub' at Cincinnati

HEBRON, Ky. -- Officials from DHL Express and the Cincinnati/Northern Kentucky International Airport joined local officials Wednesday at the airport in Hebron, Ky., to break ground for an expansion of DHL's Americas hub facility there.

The rapid growth of DHL Express continues at the Cincinnati/Northern Kentucky International Airport: Wednesday the international shipper broke ground on a second package sorting facility that will create 120 new full-time jobs at its air cargo "super hub."

"When a company finds the right place to be, things just sort of take off and keep on going, and that's the case with DHL Express here at CVG," Kentucky Gov. Steve Beshear said at the groundbreaking ceremony.

"Ever since it re-established its sort hub here with a focus on international shipping, the company has been announcing a seemingly continuous and aggressive round of upgrades, expansions and investments."

CVG is one of DHL's three global "super hubs," along with Hong Kong and Leipzig, Germany. About 92% of the company's volume in the U.S. moves through CVG.

The hub processes an estimated 2.6 million pieces of cargo every month, and that figure is expected to rise by 10 to 15% this year alone.

The expansion is the German-based cargo carrier's fourth major investment in the hub since its 2009 return from Wilmington, Ohio, after a four-year absence from CVG.

At that time, DHL spent $18.5 million to upgrade the hub, including the original 520,000 square-foot sorting facility. In 2010, it spent another $12.5 million to upgrade the computerized package sorting system.

And last November, it completed a $22.5 million, 9-acre expansion of the parking apron in order to accommodate more and larger cargo airplanes. It also spent $6 million on other initiatives, including a new employee parking lot.

With the latest expansion, DHL has invested more than $105.5 million in the hub since 2009. Its workforce in the region has also grown: in late 2009, DHL employed 1,600 people across seven operations in Northern Kentucky; it now employs about 2,000. The expansion will add 280 new jobs, including 120 full-time positions, over the next 12 months.

"But the new jobs are only part of this picture," Beshear said. "The even bigger impact will be out in the marketplace. This facility will allow DHL to handle large, non-conveyor type items, offering another logistical feature for manufacturers who need to quickly get their products and packages into the global stream of commerce.

"Just like roads and sewers, the ability to ship goods to international destinations is a critical part of any region's business infrastructure."

The expansion has been approved for up to $2 million in state and local tax incentives.

A wide range of elected officials from Kentucky and Ohio attended Wednesday's groundbreaking, calling the expansion positive economic news for the entire region.

"They're expanding their operation in the Cincinnati region, and they're spending a lot of money to do it. That means that this is a strong region, and business flourishes in our region," Cincinnati Mayor Mark Mallory said. "The expansion of DHL is important to the future of Cincinnati and, of course, Northern Kentucky."

Local economic development officials say the hub's rapid growth is creating buzz and generating new interest in the region. At least three companies, including an e-commerce firm, are in talks with the Northern Kentucky Tri-County Economic Development Corp. as a direct result of DHL's growth.

DHL also accounts for 40% of landing fee revenue at CVG, which has seen a dramatic decline in passenger air service since Delta Air Lines began reducing its hub there in 2006.

"It is our privilege to have DHL call CVG home, and to serve as one of the three super global hubs for DHL," said Candace McGraw, the airport's chief executive officer. "We are committed to helping DHL grow and establish deeper roots here at CVG."

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