Global package delivery company UPS plans to offer express package service across much of China by September. The new UPS operation will initially link 23 major metropolitan areas with next-day service. The contract-only service already is available to selected customers in five major metro areas, with the balance to be implemented by September. The new service will not have a material impact on financial performance in 2005, the company says.
Approximately 80% of China's international trade is generated within the territory that UPS will serve and these same areas are expected to experience fast-growing domestic trade as well. The company plans to expand its domestic China express service in the future beyond the initial 23 major metropolitan areas.
UPS began taking control of its operations inside China under an agreement announced last December. The deal, reached with UPS's long-time China partner Sinotrans, opened the way for operations in the 23 business centers to be transferred to UPS by this September.
Within the last year, UPS has expanded to 18 the number of weekly jet flights to and from China and will add another three daily flights in 2006. Those flights are supporting international express volume into and out of China that has seen dramatic growth in recent quarters. In April 2005, UPS launched non-stop service between the U.S. and Guangzhou, which lies strategically in one of China's fastest growing manufacturing regions.
In addition, UPS Supply Chain Solutions, the logistics arm of UPS, has opened three new warehouse and freight distribution centers in Shanghai, Suzhou and Futian and is executing plans to open another 20 facilities in major cities over the next two years. UPS Supply Chain Solutions already is operating more than 40 logistics centers in China.
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