UPS shifting Asia base from RP to China

MANILA, Philippines- Freight and logistics firm UPS is pulling out its intra Asia air hub from Clark, Pampanga and transferring it to China. Andy Connelly, UPS senior vice president for South Asia Pacific said the decision to relocate their facilities from Clark to Shenzhen airport is driven by market forces. “In the past few years the increase in trend was moving towards North of Asia. About 75 percent of the intra-Asia package volume shift to North Asia, and the decision were made to handle the packages close to our clients," he told reporters during a forum Wednesday. He said China, Hong Kong, Japan, Korea and Taiwan market account for more than half of UPS' total intra-Asia volume. But a sizeable proportion of Asia package export volume now comes in Southeast China and Hong Kong. “Given the growth in shipping alone in Southern China, it makes sense to sort and dispatch this volume from a hub closer to our customer," he said. However, Connelly said the company will retain their facility in Diosdado Macapagal International Airport (DMIA) since this will serve as their connection to the Philippines. The company has invested around $300 million in the country. “We will maintain our presence in Clark in a reduced basis. Clark will continue its function as gateway to the Philippines' import and export," he said. UPS' Clark facility can process 7,000 packages per hour. From the current 9 aircraft, Connelly said they will reduce it to 2 flights since the 7 planes will be transferred to China. Operations in Clark will remain normal until 2010. However, Connelly said they will be downsizing their workers to 70 in the next 3 years. At present, they have 200 employees in Clark. The official further added that they have explained their business move to the Philippine government officials and to its workers, who have understood their position. In the next 20 months, they will be retaining all the effective people and will be looking at employing the others in its headquarter in Paranaque, or in its new hub in China. Located in China's Pearl River Delta, the Shenzen hub will be operational in 2010. It will launch 100 flights per week and employ 400 people. The new intra-Asia hub has the capacity of 18,000 pieces per hour. - GMANews.TV