UPS COO Jim Barber expressed confidence in the company’s three-year, $20-billion transformation, despite a rough first quarter in which costly new buildings, warehouse upgrades and a harsh winter skimmed $80 million off of profits. The company invested $1.5 billion into new capacity in the first quarter — part of an expected $7 billion spend for the year. In 2018, UPS opened or retrofitted 22 facilities representing 5 million square feet globally, with 4 million of that in the U.S. The company expects to open or retrofit 20 more facilities in 2019, adding 400,000 packages per hour in sortation capacity. UPS claims 2019 is a year of investments in their network and executing strategies to improve operating costs and deliver higher quality revenue growth despite uncertain conditions. Roughly 80% of the network will “touch automation” by the end of 2019. The task before UPS in this extended technology implementation timeline is to grow package volume while increasing profitability. In January, executives were absolutely sure this is possible. In April, they seem to have added a caveat: as long as the weather cooperates.
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