UPS is committing over $2 billion to international operations, healthcare, and supply chain initiatives.
UPS informed CNBC that it is investing over $2 billion in its international, healthcare, and supply chain sectors, with expenditures beginning in 2024 and extending to 2028. Last year, the company reduced approximately 48,000 positions and indicated in January that it would eliminate an additional 30,000 jobs.
UPS has finally disclosed a figure for an initiative that was previously unannounced. The investment of more than $2 billion in its international, healthcare, and supply chain divisions, which commenced in 2024 and will continue until 2028, had not been quantified before.
This announcement comes alongside significant workforce reductions. In 2025, UPS laid off around 48,000 employees and announced plans in January to cut another 30,000 operational roles this year. The company also shuttered 93 facilities in 2025 and intends to close another two dozen in the first half of 2026.
A key reason behind these changes is a strategic decision to reduce its volume of packages for Amazon by half over the next 18 months, which equates to about a million packages daily, with a target of achieving approximately $3 billion in savings from this withdrawal.
Thus, the $2 billion investment does not signify growth but rather a shift of funds from its domestic parcel network to specialized freight, brokerage, and temperature-controlled logistics.
CEO Carol Tomé explained that the cost per package in automated facilities is 28% lower than in traditional ones, mirroring the rationale for integrating warehouse robots in Europe.
The investment initiatives are diverse and locations include a hub in the Philippines this year, a facility in Ontario next year, an air hub at Hong Kong International slated for 2028, and a logistics center in Taiwan, which has decreased total supply chain time by one day due to automation.
Europe is more of a link in the chain than a destination for these investments. UPS has launched a facility in Amsterdam that integrates freight, brokerage, and cold chain services, while also increasing its flight frequency from Paris to Hong Kong to five times a week.
The healthcare sector is particularly lucrative. Recently, UPS invested $48 million in 27 temperature-controlled facilities, primarily for the distribution of temperature-sensitive medications, including GLP-1 drugs.
DHL, another major player in the industry, is undertaking similar measures. The company is cutting 8,000 jobs in Germany to save about €1 billion by 2027 while simultaneously enhancing its health logistics capabilities, as Decathlon boosts its output with automation across seven sites in Europe.
The underlying trend is significant. Two of the world's largest logistics firms are downsizing their networks focused on consumer parcels while restructuring towards refrigerated pharmaceuticals and automation solutions.
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UPS is committing over $2 billion to international operations, healthcare, and supply chain initiatives.
UPS has announced an investment of over $2 billion in international markets, healthcare, and supply chain, despite undergoing the most significant network reduction in its history.