Deutsche Post's 3Q Report Holds Fate Of 40,000 U.S. Jobs

Berlin, Germany (AHN) - Deutsche Post AG is expected to slash all or most of the jobs in the United States to further streamline its operations as liquidity shrinks amid quarterly losses.

According to the Frankfurter Allgemeine Zeitung (FAZ), a German newspaper, the mail and logistics company is likely to slash as many as 40,000 jobs.

The details on the job cut will be disclosed on Monday when it announces its third quarter results, curtailing its previously unveiled expansion plan in the U.S.

The company had recently lowered its earning forecast for 2008 and abandoned its 2009 projection due to weakening express segment, including the DHL logistics and delivery business.

For the full-year 2008, Deutsche Post reported that it is expected to post 10 percent lower earnings compared to the previous year; and 17 percent lower from its earlier projection for the same period.

On Sunday, the news report said that the company has employed as many as 20,000 people in the U.S., while the rest are working for its partner businesses in the country.

The group's chief executive officer Frank Appel is reportedly planning to withdraw from the previous commitments in the projects, which may eventually fail as risk can no longer be calculated.

Some market analysts on Wall Street are speculating that Deutsche Post may restructure DHL segment, following its U.S. network capacity cut by 30 percent in May.

The company has suffered due to declining number of clients using express deliveries in on-going economic slowdown, compared to its U.S. rivals such as and FedEx Corp. and United Parcel Service Inc. (USPS).