UPS to move from Clark to China

**uls** · May 26th, 2008 10:58 PM

UPS to move hub from Philippines to Shenzhen
By CNA Staff Hong Kong
26 May 2008

Hong Kong - United Parcel Service (UPS) is moving its intra-Asia air hub from the former Clark base in the Philippines to China's thriving Pearl River Delta to improve customer service by reducing transit times across Asia.

UPS will base the new intra-Asia hub at Shenzhen Airport. The repositioning will slash at least a day off shipment times-in-transit for Asian customers.

The new hub represents an estimated investment of US$180 million. It will complement UPS's sorting centre at Pudong Airport in Shanghai.

UPS plans to close its intra-Asian hub at Diosdado Macapagal International Airport in the Philippines when the Shenzhen hub opens in November 2010. However, the former Clark air base, which has served as UPS's regional hub since 2002, will continue to be the gateway for the company's deliveries to and from the Philippines.

The Shenzhen hub, expected to cover 89,000 sq m will include an express Customs handling unit, sorting facilities, cargo handling and cargo build-up areas and ramp handling operations. It will be capable initially of processing up to 18,000 pieces per hour, compared to the existing 7,500 pieces per hour in the Philippines, but can be easily expanded to a capacity of 36,000 pieces per hour.

"Shenzhen's strategic location will provide significant time-in-transit and cost advantages, allowing UPS to better serve the growing Asian markets along these rapidly expanding trade lanes," said Derek Woodward, president of UPS Asia Pacific.

"We want to be where our customers need us most. Since we began flying directly to China in 2001, we have watched this region grow exponentially not only from a small package perspective but also in heavy air freight."

UPS has also added five weekly flights in and out of Nagoya to enhance customer service to Japan's Chubu region, a major industrial manufacturing centre. UPS already flies to Tokyo and Osaka. The new flights offer significant new options to Chubu industry to reach the rest of Asia and the United States.

Currently, the markets of China, Hong Kong, Japan, Korea and Taiwan account for more than half of UPS's total intra-Asia volume. Of this, a sizeable proportion of Asia package export volume now originates in Hong Kong and southeast China, where the Shenzhen hub will be located.

"Given the growth in shipping along southern China, it makes sense to sort and dispatch this volume from a hub closer to our customers," explained Woodward.

The Shenzhen Airport Group said in a statement, the partnership with UPS provided significant benefits to the city and airport. "The establishment of the hub will provide jobs and boost tax revenues, as well as provide an incentive for other companies to locate to the region.''

Times Publishing (Hong Kong) Ltd
Copyright © 2008 Times Business Information Limited. All Rights Reserved.

Source:
http://www.cargonewsasia.com/secured...&article=16226

**pup2** · May 27th, 2008 03:05 AM

There goes the employment rate ... oops. Hindi naman yata pala binabawas ang closures at downsizing doon.

**CVT** · May 28th, 2008 08:35 AM

Pathetic state of affairs in our country....

First it was FedEx,- now it's UPS. Both going to China... Again, what is the good 'ol Philippine government doing about all of these? Nada... The results speak for their mis-actions and inactions... Again, we cannot be an all-wonderful and fulfilling service-oriented country as we have no real and stable manufacturing base nor IP.

We have a lot of good friends from both companies who are now being forced to consider being 'self-employed' as opportunities here in our country are not 'plentiful'....

See my other log in the self-employment thread.....

6110:pepsi:

**Monseratto** · May 28th, 2008 08:09 PM

Its always best naman to put your business were the action is (loction,location,location...). So its more of a business decision rather than the fault of the goverment.

"We want to be where our customers need us most. Since we began flying directly to China in 2001, we have watched this region grow exponentially not only from a small package perspective but also in heavy air freight."

**Monseratto** · May 28th, 2008 08:10 PM

And would cut cost for them since most air freight are headed there anyway...

**uls** · May 29th, 2008 03:21 PM

Yes, UPS will go to where business is good.

Thing is, or the question is, why can't business be good here?

**tidus1203** · May 29th, 2008 03:31 PM

Maybe to save fuel costs din. If majority of their business is in China then it makes sense to go there since mas malapit kaysa dito...

**CVT** · May 29th, 2008 10:04 PM

Originally Posted by tidus1203

Maybe to save fuel costs din. If majority of their business is in China then it makes sense to go there since mas malapit kaysa dito...

I can probably agree here to a certain degree especially now with rising fuel costs.

However, the challenge for forwarder, courier, distribution and suplly chain solution, which are core competencies of these companies is consolidation and more consolidation as volume is exponentially increasing. The way I understand it, when FedEx decided to move to China some years ago, it wasn't primarily the cost, but the ability to expand. And the Subic hub does not have the ability to expand for reasons we all know.

Funny thing is that all of these proceedings are happening right in GMA's neighborhood...

6110:pepsi: