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Metro Newsroom

Louisville’s UPS Hub to Nearly Double in Capacity

Wednesday May 17, 2006

UPS WorldPort expansion will create more than 5,000 new jobs

For the third time in seven years, logistics giant UPS will significantly expand its WorldPort hub at Louisville International Airport – adding more than 5,000 new, well-paying jobs.

Already the largest employer in Louisville and Kentucky, UPS will invest more than $1 billion in its Louisville facility creating 1,284 new full-time jobs and 3,787 new part-time jobs.

Louisville Mayor Jerry Abramson said UPS’s continued confidence and investment in Louisville is an endorsement of the direction the community is headed and its quality of life.

"If you’re a movie buff you know that the sequel is never as good as the original," Abramson said. "However, I would say that a second billion-dollar investment by UPS is the exception to that rule, and in fact – it’s a blockbuster for this community."

The project would expand the company’s current activitieUPSs of loading, unloading, sorting, and distributing of packages, increasing its sorting capacity and ability to handle more volume. More than one million square feet will be added to its existing facility, while another 334,500 square-foot space will be renovated with new technology and equipment. Additionally, several ramps at the Louisville International Airport will be built or altered bringing a total increase of just over 3,000,000 square-feet.

Construction is slated to begin in July of this year, with an anticipated completion date in September 2010.

""We view building our communities to be part of building our business," said Bob Lekites, UPS’s Louisville-based vice president of airline and international operations. "Past public and private partnerships, as well as collaboration with local universities and minority-owned businesses, have been successful and we look forward to continuing that trend with this expansion. We’re extremely pleased with the support we've received from our government officials in the commonwealth through Gov. Ernie Fletcher and the Cabinet for Economic Development and from Louisville Metro and Mayor Jerry Abramson as well. These investments will create a better Louisville, a better Kentucky and a better UPS."

"Today's announcement by UPS is fantastic news for the LoUPSuisville region and our region's economy," said Joe Reagan, president and CEO of Greater Louisville Inc. - the Metro Chamber of Commerce. "This substantial investment will most certainly be one of the nation's largest and most significant capital investment projects of 2006. UPS's continued investment in our community clearly demonstrates that this is a great place to do business and accelerates the Greater Louisville region's leadership as a world-class logistics center."

The impact
This latest UPS expansion will have a huge impact on the local and state economy according to a study by the Kentucky Cabinet for Economic Development. The direct annual impact of new full-time jobs alone will be approximately $176.8 million for the commonwealth. Indirect and induced jobs will add just over another $100 million annually.

Abramson noted that the Metropolitan College program, an innovative concept and partnership created in 1998, between local and state government and UPS, has been instrumental in UPS’s continuing growth.

The program provides students working full- or part-time at the hub the opportunity for a free education at any one of two local colleges. Some 10,000 students have passed through its doors since its inception. Approximately 1,400 students are currently enrolled and as many as 2,200 are expected to enroll by 2010 as a result of this latest expansion.

Airport expansion laid the groundwork
Abramson said Louisville and UPS have been "steadily gaining altitude" since 1988 – when plans were announced for the $700 million expansion of Louisville International Airport, including the addition of two new parallel runways. The airport expansion was undertaken to improve local air service, spur economic growth and to put Louisville in a much stronger position to compete with other cities.

The expansion plans required the relocation of many families, businesses and churches. "It is not an easy thing to do to ask someone to uproot their family," Abramson said. "But those tough decisions – and the sacrifices made by many starting two decades ago – continue to pay off for our community in more economic development and job growth."

Economic growth related to the airport expansion has included:

  1. 36,000 jobs related to the airport
  2. $1.5 billion in annual payroll, and
  3. $220 million in state and local taxes paid

UPS is the world’s largest package delivery company and global leader in supply chain services, offering an extensive range of options for synchronizing the movement of goods, information, and funds. Headquartered in Atlanta, Georgia, UPS serves more than 200 countries and territories worldwide and operates the largest franchise shipping chain, The UPS Store.

UPS Worldport expansion

  • $1.02 billion expansion
  • 5,000 jobs created (1,284 full-time jobs, 3,787 part-time jobs)
  • Worldport capacity to expand by 60% -- from 305,000 packages per hour to 500,000 packages per hour
  • Construction to start this July, with completion in 2010
  • 3,000,000 square foot expansion, including

           o 1.1 million at Worldport building

           o 335,000 square feet in another facility

           o 1.5 million+ square feet of airfield expansion
              (several ramps built or altered)

More expansion details

UPS General Background

  • First opened overnight-sort facility on Ashbottom Rd., 1982 (150 employees, 200,000 square feet)
  • Announced Hub 2000 in 1998, opened in 2002 and changed name to Worldport
  • Worldport was a $1.1 billion investment and created 6,000 jobs at the 2 million sq. ft. facility
  • Announced air-freight operation, with Menlo acquistion in 2005; created 1,000 jobs
  • Current employment in Louisville: 18,000, with 8,300 at the airport

Louisville International

Airport Expansion – Economic Impact
  • Airport expansion announced in 1988
  • $700 million expansion to build two new parallel runways, greatly expand air service and set up the airport for future growth
  • Met economic-development projections 12 years early
  • Today the airport is the city and the state’s economic engine:

          o 36,000 jobs

          o $1.5 billion in payroll

          o $220 million in state and local taxes

  • UPS has been the catalyst for luring more than 80 companies in the past five years to locate or expand their operations near the airport, investing more the $300 million and bringing 7,500 new jobs.
  • Louisville International Airport moved up to be the fourth busiest cargo airport in the U.S. this year.