UPS, DHL Put Kentucky on Distribution Map

Kentucky has superb air, rail, highway and water transportation assets, and global air-cargo hubs for UPS and DHL that are attracting more firms to the Bluegrass State.

On Thursday, December 20, 2012 - 15:04

With excellent air, highway, rail and river assets, Kentucky is an important link in the world’s distribution chain.

Kentucky has two major air-cargo delivery hubs operated by DHL and UPS, and a host of distribution companies that have located in the state to capitalize on its unique worldwide access. In fact, Kentucky ranked third in the nation for air cargo shipments in 2010.

Along with those important air links, the state also has an excellent highway network and superior river access, both linking the state and its businesses to U.S. and world markets.

UPS’ Worldport at Louisville International Airport is the largest fully automated package-handling facility in the world. The operation currently turns over 130 aircraft daily, processing an average of 1.5 million packages a day. The facility has undergone several expansions and now measures 5.2 million square feet, with a perimeter of 7.2 miles.

"UPS chose to locate Worldport, its global logistics hub, in Louisville based on several important factors,” says Mitch Nichols, UPS Airlines president. “The first was the city's proximity to population centers – Louisville is within a two-hour flight of 75 percent of the U.S. population and a four-hour flight of 95 percent. We also examined capacity at Louisville International Airport, the airport's strong record for staying open in inclement weather, the community's quality of life, and the willingness of city and state government to work with us."

Worldport is Magnet

More than 140 companies have located in Kentucky to be close to Worldport, representing about 10,000 jobs and $290 million in payroll. Distribution companies that have located include Zappos, and Geek Squad. Zappos currently occupies three facilities in Kentucky.

DHL, a worldwide logistics company, has its U.S hub at Cincinnati/Northern Kentucky International Airport (CVG) in Northern Kentucky.

Fresh off a $22 million expansion of the hub in November 2011, DHL in March 2012 broke ground on a 193,000-square-foot sorting facility in Erlanger. The $47 million project creates 120 full-time jobs. Upgrades are also planned for DHL’s existing 520,000-square-foot facility.

“DHL will continue to expand at CVG as we accommodate the growing needs of our importing and exporting customers,” says Travis Cobb, vice president of DHL Americas' hubs, network control and gateways. “It’s a strategic location for our North America and Central America network.”

The expansion at the Northern Kentucky facility was fueled by the company's growth and optimism for the future, Cobb says.

The hub handles about 90 percent of the DHL shipments that enter the United States. DHL Express U.S. specializes exclusively in international shipping for importers and exporters, employing more than 2,000 workers at the Northern Kentucky airport, where 78 flights operate daily, connecting shipments across the United States and around the globe.

Cobb notes four key partnerships in Kentucky that have played a significant role to DHL and its growth at the CVG hub – the Northern Kentucky Chamber of Commerce, the Cincinnati/Northern Kentucky international Airport, the Tri-County Economic Development Corp., and the Kentucky state government.

Rivers, Roads, Rail

Kentucky has seven major operating river ports with access to the Ohio, Mississippi, Tennessee and Cumberland rivers. These riverports have important access to major Great Lakes, Mexican and South American markets.

The Hickman-Fulton County Riverport serves as the only public port on the east side of the Mississippi River in Kentucky. With only a nine-day journey to the port of New Orleans, the riverport has some distinct advantages.

“We think we have some competitive advantages over other areas of the country in our ability to transport goods inexpensively and quickly to market,” says Greg Curlin, port director of the Hickman-Fulton County Port Authority.

The state is also a major rail center for the mainline services of the CSX, Canadian National and Norfolk Southern railroads. These rail lines have links to major Great Lakes markets and the Gulf of Mexico.

Kentucky has five major interstate highways and nine major parkway/highways. The superior transportation network has sparked many locations of distribution centers in the state.

Late in 2011, Brown Jordan International, the largest outdoor-furniture maker in the U.S., said it would locate a new distribution center in Simpsonville, creating 12 new jobs.

Clark Associates also announced it would open a distribution center in Madisonville to serve the company’s e-commerce business, WEBstaurantStore Inc. The facility, which will distribute food-service equipment, will employ 95 workers.