UPS will spend more than $300 million on its new air hubs at Shanghai and Shenzhen to increase itspresence in the fast-growing Chinese market, according to a senior executive.
Dan Brutto, head of international operations, told Dow Jones news agency that the companywill be investing $125 million on its new Shanghai hub which is due to go into operation inNovember. UPS, which invested about $600 million in China during the 2002-2007 period, had notpreviously disclosed the level of investment for the Shanghai hub.
Under plans announced last year, the 96,000 sqm hub at Shanghai’s Pudong InternationalAirport will have sorting capacity of 17,000 pieces per hour by 2012. UPS will use the hub to linkits international and domestic flights to, from and within China. It currently has about 76 weeklyflights at Shanghai, while Chinese uplift partner, locally-based Yangtze River Express, currentlyoperates 24 dedicated weekly flights for UPS.
UPS will spend about $180 million on its intra-Asia hub in Shenzhen, which will open in 2010and replace an existing facility in the Philippines. The 89,000 sqm hub have capacity to processabout 18,000 pieces per hour. UPS said in May that it would relocate to Shenzhen from thePhilippines to be closer to the Pearl River Delta manufacturing area and to cut intra-Asia transittimes by one day on many routes.
Brutto also said he expected UPS to generate about 40% of revenues from internationalbusiness by 2010, and said the company’s Europe-China volumes would grow by more than 25% thisyear.
