UPS expects record holiday shipping season

3:50 p.m Thursday, Oct. 26, 2017 Business

UPS expects to handle a record 750 million packages over the holiday shopping period from Thanksgiving to New Year’s Eve this year.

The Sandy Spring-based shipping giant said it expects delivery volume to be up 5 percent this year over last year’s holiday peak season, as online shopping continues to grow.

But it could be more expensive to ship packages this year. UPS is adding peak season surcharges for the 2017 holiday season. And starting Dec. 24, UPS is increasing its rates an average of 4.9 percent.

UPS CEO David Abney said in an interview with The Atlanta Journal-Constitution that he expects more retailers to start promotions early or run them outside of peak periods to “beat a surcharge.”

“This just adds a financial incentive to get our customers to work within our capacity,” Abney said.

Holiday shipping volume on UPS is nearly double its regular daily volume. For the holiday season, the company is hiring 95,000 temporary workers, including drivers, package sorters and loaders.

UPS said its new Saturday ground pickup and delivery service will help it to handle increased volume. The company is also building new facilities to boost capacity, and said it has added nearly 8,000 permanent year-round positions due to the growth.

The company, which on Thursday reported more than $1.2 billion of profit for the third quarter, said its operating profit took a $50 million hit from natural disasters in the quarter.

That includes impact from hurricanes in Houston, Florida, Puerto Rico and Louisiana, wildfires in California and the earthquake in Mexico. There is lasting impact in Puerto Rico and California due to businesses that are UPS customers that have not been able to re-open their buildings yet, Abney said.

“It just takes longer to turn it around then a few weeks,” he said.

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