United Parcel Service (UPS) has continued to see growth in its operations in UAE with a 15 per cent increase in exports from the UAE in 2008 compared to the previous year despite the challenging economic times, said a senior company executive.
While the global economic crisis is widely expected to affect express air freight in the region this year, UPS is hoping for a healthy performance.
"UPS is strongly positioned and has the regional expertise and market longevity to manage this situation," said John Tansey, UPS Managing Director for the UAE.
"We expect a challenging year for most businesses; therefore players in the logistics industry will have to step up to face the economic situation," he said.
Tansey said the company was adopting new measures and innovations aimed at stimulating growth given the economic situation.
UPS last year enhanced its service portfolio in the UAE, launching a new global air freight portfolio that offers its customers guaranteed integrated air freight services in a single offering.
It also introduced an economic small package solution with UPS Expedited – the perfect balance between economy and speed.
"Our new services redefine UPS's commitment to its customers in the UAE, offering them greater flexibility and the opportunity to come out ahead in a competitive environment," added Tansey.
UPS total revenue in 2008 slid 5.2 per cent to $12.7 billion (Dh46.6bn), as average daily volume worldwide dropped 2.3 per cent on the back of drying consumer spending and increased economic hardships.
UPS is, however, still a profitable and cash-generating business. The company earned an operating profit of $6bn in 2008 and ended 2008 with $1bn cash. In an effort to hold down costs, UPS is suspending its 401(k) match for more than 35,000 non-union employees in the US. UPS also will extend a year-old hiring freeze.
Tansey said the company's operations in the Middle East will continue to perform well given the increasing need for efficient third party logistics by most firms.
He said success during this crisis will be determined by the level of efficient services players will have to introduce to the market.
"In these times, the need for efficient and effective express service is crucial for businesses needing to stay responsive to their customers' growing demands for reliable global transportation," said Tansey.
He said that in the meantime, the company was taking measures to ensure efficient utilisation of assets and resources and keep overhead costs under control to help it through the current economic conditions.
"Despite this environment, we believe our strategy and business model are sound and that UPS offers a vastly better value proposition to the marketplace than any of our competitors.
We will continue to make strategic investments that provide opportunities to grow our company and strengthen the services and solutions we bring to our customers," he said.