United Parcel Service’s new air hub at Clark International Airport in the Philippines is 15 times larger than its predecessor, enabling the express carrier to provide up to two days faster delivery for customers within Asia and improve connectivity across its global network.
UPS (NYSE: UPS) spent $80 million on the expansion project, which includes specialized handling areas for healthcare, high-tech and manufacturing customers with time-sensitive and temperature-sensitive shipments. Parcel handling capacity increased to an average daily volume of 46,000, with maximum processing capacity of 15,000 pieces per hour, according to a news release on Thursday.
The announcement marks the first time UPS has disclosed the size of the capital expenditure to expand its Clark hub, which now covers 323,000 square feet.
UPS now operates 170 flight segments into and out of Clark every week, connecting businesses across Asia Pacific, India, Europe and the United States in as little as one business day. The new hub has also created nearly 600 jobs, the company said.
In August, the U.S. Department of Transportation approved the transfer of six UPS flying rights between Hong Kong and Warsaw, Poland, and Hanoi, Vietnam, to Clark Airport to support growing trade flows between the Philippines and Hong Kong.
UPS began operations at Clark, a former U.S. Air Force base, in 2002 and announced plans to build a new facility in March 2024.
Why It Matters: Service enhancements enabled by the new Clark hub include up to two days faster delivery to and from eastern China and other major Asia Pacific markets, and similar transit improvements between several Southeast Asian markets and India, UPS said. Faster service also enables UPS to extend shipment pickup windows at customer locations and make faster deliveries to cities in the region.
“Asia Pacific has been the heartbeat of global trade for years. There are still plenty of growth opportunities for the region’s businesses and a lot of untapped potential. Clark is the latest in a series of recent major investments UPS has made in its Asia Pacific network and there’s more to come as we continue to speed up connectivity, unlock trade growth opportunities, improve service reliability and strengthen supply chains for our customers,” said Bernard Jiang, president UPS Asia Pacific, in the news release.
The new hub houses three refrigeration and freezer units, ranging from -20 to 25 Celsius, dedicated re-icing capability and UPS RFID technology to provide priority handling and enhanced visibility for critical and temperature-sensitive healthcare shipments.
It also features an automated sorting system, which uses smart technology to process up to 9,000 small packages per hour. Ramp operations use a fleet of electric ground servicing equipment, including cargo tractors, belt and cargo loaders, ground processing units and forklifts.
Clark is the latest in a series of investments to expand capabilities in UPS’s Asia-Pacific network. In March, the express carrier broke ground on a new hub at Hong Kong International Airport and in April it completed an expansion of its hub at Incheon Airport in Seoul, South Korea, quadrupling the size of the previous facility. During the same period, UPS also opened its largest logistics center in the region, in Taiwan.
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