UPS is planning to invest a total of about $2 billion in Europe by 2019 to expand capacity in response to rising volumes.
A significant part of this sum will be dedicated to expansion in Germany, its biggest single market outside the USA, where the company’s export volumes grew by 10% over the first nine months of this year compared to a 5% increase for Europe as a whole.
German transport newspaper DVZ reported yesterday that “UPS doubles investments in Europe to $2 billion”, adding that much of this sum would be invested in Germany.
A UPS Germany spokesman confirmed the $2 billion investment figure to CEP-Research today but made clear this was not a ‘doubling’ of the previously published figure of $1 billion.
“Our investment plans over the next 5 years (2015 – 2019) include capital spending of about $2 billion; a historic run rate of about $700 million, boosted by about $1.3 billion as disclosed in July of 2014 and again discussed at the investor conference in 2014,” he explained.
At that time UPS executives referred to planned investment of ‘more than $1 billion’ in Europe as part of overall $2 billion spending worldwide to expand the international network but were not more precise about the additional capital investment figure. They mentioned expansion projects in Paris, Istanbul, Hamburg and Berlin along with new facilities at Copenhagen and East Midlands Airport in the UK.
On Germany investment plans, the UPS spokesman confirmed: “A large part of this ($2 billion) is planned for Germany. There are plans to further expand various branches.”
UPS has already invested $40 million to expand its Nuremberg site into a logistics hub serving as a gateway for exports from Germany, Benelux and Scandinavia to various countries in southern and eastern Europe, including Austria, Czech Republic and Slovakia as well as Italy and Greece. The expanded facility, with sorting capacity doubled to 30,000 packages an hour, went into service earlier this year.
The company is also considering expanding its existing parcel centres at Herne and Herford in north-west Germany. In March 2014, UPS already officially opened a $200 million expansion of its European air hub at Cologne/Bonn airport, which increased sorting capacity by 70% to 190,000 packages per hour.
Overall, UPS has 72 package depots and 11 supply chain branches in Germany, as well as its European air hub at Cologne/Bonn airport. It has flights to Berlin and Munich, a ground fleet of more than 3,600 vehicles, and more than 3,100 customer service centres, including parcel shops.
Elsewhere in Europe, UPS has this year opened a €25 million parcels hub in Poland, several new facilities in the Netherlands and the UK, and announced plans for a large €170m parcels hub near London.
