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UPS doubles plane order
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January 9, 2001: 1:05 p.m. ET
Ups order with Airbus Industrie to 60 planes from 30, citing higher volumes
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NEW YORK (CNNfn) - United Parcel Service Inc., the world's biggest freight company, Tuesday said it doubled its order with aircraft maker Airbus Industrie for A300-600 airplanes, in anticipation of higher shipping volume that it expects will soon begin to strain its current fleet of jets.
Atlanta-based UPS said it has now placed a firm order for 60 A300-600 freighter airplanes from Airbus Industrie, double the 30 airplanes it initially ordered. The first seven of those aircraft were delivered last fall and another 13 are scheduled for delivery this year.
The revised order superseded the company's 1998 order and carries a list price of $6 billion, the company said. The latest order also includes options for an additional 50 aircraft, making it the largest single aircraft deal in UPS's history. UPS will spread its payments for the aircraft over nine years.
 "We remain confident about our long-term customer demand in the U.S. and abroad," said Bob Lekites, vice president of UPS's airlines operations. "And whether it's in Europe, Asia or Latin America, we need to be prepared to deploy a modern jet freighter that's flexible enough to operate anywhere."
Several new and used aircraft types were considered by UPS, but the A300-600 was judged to provide the best combination of operating characteristics and extended acquisition economics, Lekites said. UPS's current fleet consists of 238 jets -- mostly Boeing 727, 757, 767 and 747 aircraft.
An expected increase in the number of packages and containers shipped via UPS is the main reason for the revised order, the company said. During the third quarter of 2000, for example, UPS's international export volume climbed 23 percent compared with the year-earlier period.
The order will help Airbus Industrie with its transformation into a company from a consortium, which it plans to do by the end of February. The Airbus consortium said last June that it planned to restructure to position itself to take on rival Boeing Co. (BAE: Research, Estimates).
Serving more than 200 countries and territories, UPS is the world's largest package delivery company. Shares of UPS (UPS: Research, Estimates) slipped 6 cents to close at $61.00 Tuesday. UPS became a publicly traded company in November 1999, rocketing more than 30 percent in its first day of trade. 
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United Parcel Service
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