UPS currently operates 3 ex-VASP, 2 ex-Varig, and 8 ex-JAL MD
-11's. This year UPS will put into operation the last 2 ex-JAL's and 2 ex-Varig MD
-11's. The first 2 ex-Swiss MD
-11's will be put into operation late this year with the remaining 9 coming into the system by 2007.
That will make 28 MD
-11's in the fleet.
The rational for cutting the A300 order and ordering the A380's are two fold. With increasing competition domestically, there is pressure to continually improve service while keeping costs down. So the company is relying more on long distance trucking with driver teams, so the transit time remain the same as air with lower costs.
Frequencies into China are still very much controlled by the Chinese government, so the only way to increase capacity into China is to operate airplanes with higher cargo loads. Competition is heavy, but everyone is operating with the same restrictions while attempting to get more frequencies into more cities in China. The potential for every operator, both Chinese and foreign is tremendous; even with the limitations and only a relatively few Chinese using these services, growth will be the highest of any region in the world.