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UPS, Two Hubs Next To Each Other?  
User currently offlineB-HOP From Hong Kong, joined Nov 2000, 623 posts, RR: 1
Posted (11 months 4 weeks 1 day 18 hours ago) and read 6653 times:

Do UPS operate Hong Kong as a hub? As I see five UPS aircraft in CLK. They have Shenzhen an hour drive away, do they focus on separate market or are they 'compete' with each other?


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10 replies: All unread, jump to last
 
User currently offlineLAXintl From United States of America, joined May 2000, 24785 posts, RR: 46
Reply 1, posted (11 months 4 weeks 1 day 18 hours ago) and read 6517 times:

No, HKG is not a UPS hub perse. HKG is simply a large gateway market with flights to the US (including via Korea/Japan/Guam) and links to the European hub in Cologne hub also.

UPS "Asia-Pacific" hub is in Shenzhen which is connected to Australia, India, Korea, Singapore, Vietnam, Japan amongst other markets. This hub carries 75% of the companies intra-regional shipments, and represents about 2/3 of the flying in the region serving 21 airports.

UPS also has a "International Air Hub" at Shanghai Pudong that is connected to the the UPS global air network with flights to the U.S. and European destinations.

Interestingly UPS Asia-Pacific headquarters is Singapore.

About 30-aircraft are dedicated to Asia-Pacific operations (757/767 + MD11/744)



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User currently offlineB747400ERF From United Kingdom, joined Jun 2013, 372 posts, RR: 0
Reply 2, posted (11 months 4 weeks 1 day 3 hours ago) and read 5532 times:

Quoting LAXintl (Reply 1):

Interestingly UPS Asia-Pacific headquarters is Singapore.

Probably for tax reasons.


User currently offlineMaydayMark From United States of America, joined Jul 2013, 1 posts, RR: 0
Reply 3, posted (11 months 4 weeks 19 hours ago) and read 3049 times:

Singapore is one of the largest shipping ports in the world (it was previously the largest!). It's also a major financial center. Why would UPS be interested in having an office there?

http://en.wikipedia.org/wiki/Singapore

[Edited 2013-07-28 09:19:34]

User currently offlineLAXintl From United States of America, joined May 2000, 24785 posts, RR: 46
Reply 4, posted (11 months 4 weeks 18 hours ago) and read 2505 times:

I'd say regional HQ in Singapore has more to do with taxes/finance, than any logistics need.

UPS is actually rather small in Singapore, only about 2 daily flights (some days 3) with the round the world services going through most days.

Biggest logistic claim of UPS Singapore is that it specializes in focus on pharma traffic with a special designed temperature-sensitive warehouse and cold-chain distribution network.



From the desert to the sea, to all of Southern California
User currently offlineIndianicWorld From Australia, joined Jun 2001, 2901 posts, RR: 0
Reply 5, posted (11 months 4 weeks 5 hours ago) and read 1900 times:

Seems like UPS really are focusing greatly on the Chinese market.

As stated above, having the HQ in Singapore is mainly from a taxation/ bottom line perspective, but also from an ease of doing business viewpoint. Having a HQ next to the main ops bases is not imperative.


User currently onlinemozart From Luxembourg, joined Aug 2003, 2167 posts, RR: 13
Reply 6, posted (11 months 4 weeks 5 hours ago) and read 1884 times:

Quoting LAXintl (Reply 1):
UPS "Asia-Pacific" hub is in Shenzhen which is connected to Australia, India, Korea, Singapore, Vietnam, Japan amongst other markets. This hub carries 75% of the companies intra-regional shipments, and represents about 2/3 of the flying in the region serving 21 airports.

UPS also has a "International Air Hub" at Shanghai Pudong that is connected to the the UPS global air network with flights to the U.S. and European destinations.

This is very interesting, thanks for that! I always wanted to know how these things function.

So can you explain to me the difference between an "Asia-Pacific" hub (SZX) and an "International Air Hub" (PVG)? What kind of freight goes through which and why? What kind of flights go through which and why?

What are the other regional or international air hubs in the UPS network? I understand Cologne is an important one and so is Louisville?


User currently offlineblueflyer From United States of America, joined Jan 2006, 3916 posts, RR: 2
Reply 7, posted (11 months 4 weeks 4 hours ago) and read 1826 times:
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The situation isn't unique to UPS. FedEx operates a regional hub at AFW while, less than 30 miles down the road, still maintaining five daily flights between DFW and its MEM and IND hubs.

Quoting LAXintl (Reply 4):
I'd say regional HQ in Singapore has more to do with taxes/finance, than any logistics need.

Quite right, just like UPS Europe is headquartered in Brussels, near BRU as a matter of fact, even though UPS Air doesn't fly to Belgium (other than the occasional diversion from CGN just across the border), every UPS package in Belgium is trucked to/from the CGN hub.

Quoting mozart (Reply 6):
So can you explain to me the difference between an "Asia-Pacific" hub (SZX) and an "International Air Hub" (PVG)?

The difference isn't in the kind of freight, but in the origin/destination. PVG is for shipments between China and destinations outside the Asia-Pacific region. SZX handles shipments within the Asia-Pacific region and between Asia-Pacific and the rest of the world.

CGN is UPS' hub for Europe. It handles both intra-European shipments and shipments between Europe and the rest of the world.

In the US, UPS operates several regional hubs handling shipments between a few states each, at DFW, CAE, RFD and PHL. ONT and MIA also act as regional hubs for the states in their vicinity, but also as gateways to China and South America respectively. YHZ is the Canadian hub.

SDF is UPS' global headquarters and its largest hub, with flights to over 200 destinations in the US and beyond.



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User currently onlinemozart From Luxembourg, joined Aug 2003, 2167 posts, RR: 13
Reply 8, posted (11 months 4 weeks 2 hours ago) and read 1739 times:

Thanks blueflyer!!

Quoting blueflyer (Reply 7):
The difference isn't in the kind of freight, but in the origin/destination. PVG is for shipments between China and destinations outside the Asia-Pacific region. SZX handles shipments within the Asia-Pacific region and between Asia-Pacific and the rest of the world.

So why do they have two different ones then? If PVG does China->rest of world and SZX also does APAC (which includes China)-> rest of world, why two hubs? Wouldn't it be simpler to have only one hub?


User currently offlineblueflyer From United States of America, joined Jan 2006, 3916 posts, RR: 2
Reply 9, posted (11 months 3 weeks 6 days 17 hours ago) and read 1523 times:
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Quoting mozart (Reply 8):
So why do they have two different ones then?

I don't know the reason for these two hubs, but my guess the probable answer is geography.

PVG is too far North to be a suitable Asia-Pacific hub. For example, a round-trip from SIN takes 11 hours, without additional time for the sort. Routing everything through PVG would saddle UPS with non-competitive cut-off times (I estimate around 3:30) compared to DHL (6 pm). On the other hand, UPS is limited in its ability to move freight within China and routing shipment to/from the US through SZX would add a day's transit.

If UPS has enough volume, it therefore makes sense to split its operations between PVG and SZX. It cuts down on transit times and UPS saves on fuel by shortening flown distances.



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User currently offlineLAXintl From United States of America, joined May 2000, 24785 posts, RR: 46
Reply 10, posted (11 months 3 weeks 6 days 17 hours ago) and read 1472 times:

The hubs serve very different needs. SZX is primarily for intra-Asia-Pacific shipments. Similar to how FedEx runs its AsiaOne network from sorting hub in Guangzhou(used to be in Philippines). Also DHL has its hub in HKG. The geographic location is considered well centered for shipments across the region.

Regarding UPS PVG, it has both slot and facility limitations as well. PVG serves as more an export driver with longhaul links to Europe and North America with far less intra-regional connectivity.

FedEx also has multiple regional hubs in Asia. SIN - is the South Pacific link and KIX is the North Pacific hub plus along with larger operations in HKG and PVG as well.



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