UPS starts construction of intra-Asia hub

Construction began today on UPS's new intra-Asia air hub at Shenzhen International Airport.

Once completed, the Shenzhen facility will replace UPS's current intra-Asia hub located at the former Clark Air Base in the Philippines and will serve as UPS's primary transit hub in Asia.

The repositioning of the air hub will knock at least one day off shipment transit times for Asian customers.

The new US$180 million Shenzhen hub will be built on a land area of 89,000 m2 and will include a dedicated 150,000 m2 ramp provided by Shenzhen Airport, an express customs handling unit, sorting facilities and cargo handling areas.

The one million sq.ft hub will initially be able to process up to 18,000 pieces per hour, with the capacity to expand to 36,000 pieces per hour. In comparison, the Philippines hub can process 7,500 pieces per hour.

The facility is expected to open in 2010, and will operate 24/7.

According to Daniel Brutto, president of UPS International, the strategic location of UPS's Shenzhen intra-Asia hub is going to strengthen the company's position in Asia.

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 considerable proportion of Asia package export volumes now originate in southeast China and Hong Kong.

Since taking direct control of its international express operations inside China in 2005, UPS has made significant investments in the country.

UPS signed an agreement with the Shanghai Airport Group in 2007 to establish a UPS International Air Hub at Pudong International Airport in Shanghai, which is scheduled to be operational in December 2008. The Shanghai hub will connect China to the UPS global air network, including US and European destinations, while the Shenzhen hub will connect all major Asian points.