UPS officially breaks ground on China-based international air hub

Staff -- Logistics Management, 8/9/2007

SHANGHAI, China—UPS announced at a formal groundbreaking ceremony today it has officially commenced construction for the UPS International Air Hub at Pudong International Airport.

In April, the company initially announced unveiled its plans to construct the hub, which is scheduled to open in 2008 and will be the first China-based air hub built by a U.S. carrier. UPS said this hub will link all of China via Shanghai to UPS’s international network with direct service to the Americas, Europe, and Asia. And it will also connect points served in China through a dedicated service provided by Chinese all-cargo airline Yangtze River Express. 

UPS said in April that this hub project is the latest in a series of strategic initiatives to expand its operations and brand presence in China. In 2005, it took direct control of its operations, serving more than 330 cities in China representing 85 percent of the country's international trade activity. UPS also expanded its air operations in China throughout 2006 and said it now flies to more points in China than any other U.S. airline. And UPS has grown its China workforce to more than 4,500 employees and is building a logistics infrastructure that includes more than 60 distribution centers.

Additionally, in the last five years UPS has invested approximately $600 million in China, including its successful transition to become the first wholly-owned foreign express carrier in China.

The new hub will be located in the southern end of the West Cargo Terminal Area at Pudong International Airport. It will be built on land totaling almost 96,000 square meters (1 million square feet) and rapid expansion is expected. The hub sorting capacity is projected to reach 17,000 pieces per hour by 2012 and employment should exceed 1,000 by 2010. The International Air Hub will offer immediate benefits to UPS customers, including later pick-up times in the Shanghai region and expanded capacity.

“The opening of this hub will ensure we are well-positioned to support the explosive growth in Asia's regional trade," said UPS Chairman and CEO Mike Eskew, at the groundbreaking ceremony. "Export volume growth in China and throughout Asia has been robust and the outlook remains bright. We are extremely proud to be the first U.S. airline to open an international air hub in China under the 2004 U.S.-China Air Services Agreement."