United Parcel Service today signed an agreement with Chinese airport officials to build and operatea huge new cargo hub at Shanghai.
The new hub will link all of China, through the expanding Pudong International Airport, withdirect services to the USA, Europe and the rest of Asia.
At a ceremony in Shanghai, attended by US transport secretary Mary Peters, UPS said the96,000 sqm hub now under construction would be able to sort 17,000 cargo items per hour by 2012 andwould employ 1,000 staff by 2010. It will be served by Boeing 747-400 freighters, replacing thesmaller MC-11 jets currently in use.
Ken Torok, UPS Asia Pacific president, told reporters at the event that the US carrier hadinvested around $600 million over the past few years to become a top player in the Chinese market.
UPS has so far spent $20 million in initial investment at the hub, which is to open nextyear. The hub will operate every day around the clock, allowing for later pick-up times inShanghai, China’s financial and commercial centre, the company said.
UPS is, like the other three main global express carriers TNT, DHL and FedEx, expandingrapidly in China to compete for fast-growing business as trade booms with the rest of the world.
Today’s signing, with the Shanghai Airport Authority, was for the operating agreement andlease contract for the hub, its fourth in Asia after Manila, Hong Kong and Taipei.
UPS can now implement new rights granted by the contract, including self-handling. It is theresult of the China-US air services agreement signed by the two governments in 2004.
“The UPS International Air Hub will connect China to international markets faster and moreefficiently,” Torok told Associated Press.
The hub will use a new runway at the airport which should be completed later this year.
The airport authority is building the hub for UPS. It said cargo handling capacity at theairport increased to over two million tons last year from 635,000 tons in 2002.
UPS currently has 76 flight take-offs and landings at the airport each week. The US carrierexpanded its air operations in China throughout 2006 and now claims to fly to more points in Chinathan any other US airline, freight or passenger.
It took over full ownership of its China operations in 2005 and now serves 330 Chinese citieswith more than 60 facilities and 4,000 employees. Last year, the company launched express centresin Shangai in its first retail endeavour in China.
