Amazon and e-commerce continue to be a game-changer at UPS. The company’s top brass announced today they will look to cut costs. When the next contract is negotiated, UPS Teamsters need to be ready to defend our jobs.
UPS made adjusted profits of more than $5 billion in 2016. But Amazon and e-commerce cut into those profits—and management is promising investors to cut costs.
The company reported a huge shift in the amount of volume that went to residential customers versus business delivery in the fourth quarter.
Fifty-five percent of volume was e-commerce and other business-to-consumer deliveries. Packages were delivered to nearly 2.5 million new addresses.
Delivering to individual residential customers costs more than multiple shipments to businesses. The “last-mile” of delivery is the most expensive.
UPS management is determined to cut those costs. That’s what Surepost is about—and they have told investors more cost-cutting is on the way.
Today, the company told investors it will spend $4 billion to expand capacity and automate hubs. Three hubs have been automated so far. UPS said 30 to 35 more will automated in all.
UPS is also looking to cut costs by subcontracting feeder jobs to Coyote Logistics.
Here’s what doesn’t cut costs: creating more full-time jobs, increasing part-time wages, and hiring more drivers to reduce excessive loads, 9.5 violations and harassment.
UPS made over $5 billion in profits last year. Management is promising even higher profits next year.
UPS Teamsters have five billion reasons to reject any contract that includes concessions or cost-cutting at our expense. It’s time for UPS to deliver for us.
UPS Teamsters need to be ready to fight for the contract we deserve.