UPS adds to B747-8F order as it beefs up fleet for growth

UPS has ordered an additional 14 Boeing B747-8F cargo jets and four new Boeing 767F aircraft to provide additional capacity in response to demand growth.
All of the new aircraft will be added to the existing fleet and no existing aircraft are being replaced. 
The aircraft will be delivered on an expedited schedule, building on the company’s 2016 order of 14 Boeing 747-8 freighters.
All 32 of the jets will be delivered by the end of 2022, adding more than 4,000 tonnes of cargo capacity.
UPS’s global airline network includes more than 500 owned and leased aircraft. UPS received three new B747-8 freighters in 2017.
“Our intra-US next-day and deferred air shipments are expanding to record levels, and UPS’s International segment has produced four consecutive quarters of double-digit export shipment growth,” said David Abney, UPS chairman and chief executive.
“To support this strong customer demand, we continue to invest in additional air capacity, providing the critical link our customers need to markets around the world.”
UPS said that in addition to growing customer demand for express services, recent US tax reform legislation had enabled it to increase capital investments and to make them earlier than previously planned.
“As we celebrate the 30^th anniversary of UPS Airlines today, we are seeing unprecedented demand for our air products,” said UPS Airlines president Brendan Canavan.
“The new freighters will allow us to continue upsizing aircraft on routes and will create a cascading effect that will boost capacity on regional routes around the world.”
The 747-8 freighter carries 46 shipping containers, 34 on its main deck and 12 in its lower compartments.
The -8 has a cargo capacity of 140 tonnes, or approximately 30,000 packages and a range of 4,200 nautical miles.
The Boeing 767 freighter has cargo capacity of 60 tonnes and capacity for 31 air containers, 24 on the main deck and 7 in its lower compartments.  It has a range of approximately 3,000 nautical miles.  UPS currently operates 59 Boeing 767 aircraft.
“UPS has clearly tapped into the power and efficiency the 747-8 Freighter brings to the market,” said Boeing Commercial Airplanes president and chief executive Kevin McAllister.
“We’re impressed with how UPS is leveraging the airplane in its operations and excited to see them bring additional 767s into their fleet.”
Before UPS’ 2016 order for the B747-8Fs, the aircraft’s future had looked in doubt because of a lack of demand.
As well as the order for new aircraft, UPS today announced more than $12 billion in investments to expand the company’s Smart Logistics Network, significantly increase pension funding, and position the company to further enhance shareowner value.
“This $12bn investment programme is an outgrowth of the opportunity for tax savings created by the Tax and Jobs Act,” said David Abney, UPS Chairman and chief executive.
“We will increase network investments and accelerate pension funding to strengthen the company for the long term, so that we maximise the benefit to our global customers, employees and shareowners.”
The company plans to raise future capital spending above its previously committed six-to-seven percent of annual revenue.
UPS will invest an additional $7bn over three years for the construction and renovation of facilities, to acquire new aircraft and ground fleet vehicles, and to enhance the information technology platforms required to support the network, manage the business and power new customer solutions.
The company also reported an acceleration in financial performance earlier today.