Faced with a major cutback in Amazon deliveries and the ongoing strain of U.S. tariffs, UPS will slash 20,000 jobs and shutter 73 facilities. The move follows Amazon’s decision to decrease shipping volume with UPS by 50% as part of its own operational adjustments.
UPS CEO Carol Tome highlighted the unprecedented threat to global trade posed by current conditions. The Teamsters union, representing a majority of UPS’s U.S. workforce, warned of a potential contract dispute over the job cuts, while UPS affirmed its commitment to the agreement.
As a bellwether for the global economy, UPS’s struggles reflect broader economic headwinds. The company aims to reduce costs by $3.5 billion by 2025, partly by cutting less profitable Amazon-related work.
UPS also faces challenges from tariffs on Chinese goods, a key revenue source, and shifting dynamics with bargain e-commerce sellers. While seeing growth in other markets, replacing China’s volume remains a long-term hurdle. The company’s outlook hinges on the resolution of U.S.-China trade tensions.
