Job Reductions and Operational Changes
United Parcel Service (UPS) announced plans to eliminate an additional 30,000 jobs this year. This decision is part of winding down its partnership with Amazon and aligns with a multiyear turnaround plan.
CFO Brian Dykes stated during a quarterly earnings call that UPS anticipates reducing total operational hours by approximately 25 million, related to the decrease in Amazon-related operations.
Dykes indicated that up to 30,000 operational positions would be reduced through attrition and a second voluntary separation program for full-time drivers.
UPS has identified 24 buildings for closure in the first half of 2026, with potential for further closures later in the year. The company previously closed 93 buildings last year. Additionally, UPS plans to deploy further automation across its network.
Context of Previous Reductions
These planned job cuts follow the elimination of 48,000 positions last year, comprising 34,000 operational and 14,000 management roles. Earlier estimates had projected a total reduction of approximately 20,000 positions.
Teamsters Union Response
A Teamsters union representative stated that its workers "still know their worth" if UPS reinstates its buyout program.
The statement conveyed the union's satisfaction with UPS achieving growth and cost savings from corporate management, provided contractual commitments to members are upheld and Teamsters are rewarded.
Turnaround Plan and Financial Impact
UPS is currently implementing a turnaround plan led by CEO Carol Tomé to revitalize the business. While Amazon was previously UPS's largest customer, the companies are phasing out their joint operations. UPS expects $3 billion in savings from the Amazon partnership unwind.
UPS reported its fourth-quarter earnings, exceeding Wall Street estimates and noting progress in its turnaround initiatives. Company shares increased by 4% in morning trading following the announcements.