United Parcel Service this summer will begin offering time-definite, heavy freight air service between the United States and Mexico on its own aircraft for the first time as part of an initiative to provide more tailored supply chain services to automotive and other industrial customers with operations in both countries.
The integrated logistics and parcel giant said Friday it has also invested nearly $50 million to build a freight-friendly cross-border product within the UPS Ground parcel transportation system and teams with more than 300 industry-specific experts who can help customers navigate the best logistics options amid increased trade complexity associated with higher tariffs, changing regulations, and rising fuel prices.
UPS (NYSE: UPS) in August will begin offering one-day, two-day and three-day service options to and from Mexico that are designed to help manufacturers move high-value, time-sensitive parts with greater speed and predictability than previous offerings. UPS will also use trucks for some traffic.
UPS services between the United States and Mexico have traditionally focused on small package shipments, with remaining capacity allocated for freight. The difference now is that UPS is offering a service upgrade in which shippers can receive day-definite, guaranteed service, spokesman Jim Mayer explained in an email.
UPS operates scheduled flights to-and-from Mexico City, Guadalajara and Monterrey. Depending on the service option selected and time-in-transit, volume also may move on ground from Mexico to U.S. gateways, such as El Paso and Dallas, Texas, where it will be loaded onto a UPS flight to destinations anywhere in the U.S. or Canada. In some cases, a movement may go by ground only, he said.
The new UPS Ground with freight pricing functions as a less-than-truckload solution for multi-package shipments over 150 pounds, using the more simple parcel network. It is designed for multi-package shipments that do not require a pallet. UPS has offered freight-pricing in UPS Ground within the domestic U.S. market, but is now extending that to cross-border movements.
“Our automotive and industrial customers want an easy button for logistics,” said Matt Guffey, UPS chief commercial and strategy officer, in a news release.
WeatherTech uses UPS to ship automotive accessories and CEO David MacNeil said the company is pleased with the shipping reliability, according to the news release.
The new investments in North American cross-border shipping dovetail with UPS’s strategy to deemphasize low-margin parcel business and focus on high-value goods and complex supply chains, such as automotive, that require premium services.