UPS Sees Strong Asia Growth, To Add Aircraft

May 18, 2010

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United Parcel Service, the world's largest package delivery service, said on Tuesday it expected strong growth in the second quarter in its Asia business amid an improving regional economy.

UPS's Asia volume grew more than 20 percent in the first quarter with the fastest growth from the region's small- and medium-sized enterprises.

The volume growth in Asia remained "very strong", said Derek Woodward, UPS Asia Pacific President. But he declined to give further details.

Atlanta-based UPS reported better-than-expected first-quarter earnings last month and the company was optimistic about the market's outlook this year.

Woodward was in Shenzhen for the opening of UPS' Asia Pacific hub at the city's Baoan International Airport. The facility, with an investment of USD$180 million, replaces UPS's hub at Clark, in the Philippines.

"China is our No.1 international priority," Woodward said. "The new hub shall help to facilitate business in Asia."

Shenzhen, which is UPS's second hub in China after Shanghai, will focus on intra-Asia traffic, which is boosted by a bilateral trade agreement between China and ASEAN that came into effect this year.

The volcanic ash cloud hampering air traffic in Europe did not present any issues for its business, International President Daniel Brutto told reporters.

Brutto also said the Europe debt crisis and a recent fall in the euro had no major impact on UPS's business so far and the crisis was isolated in Greece, Portugal, Spain and Ireland.

"I can't predict the future but at this stage we are still very confident in our growth in Asia to Europe," he said.

UPS plans to add two aircraft in Hong Kong and 11 in Shanghai from June 1 to tap growth in China. It currently operates 23 aircraft within the Asia Pacific region.