UPS Plans for More Capex As Labor Contract Costs Start to Pass

United Parcel Service plans to devote a larger chunk of its revenue to capital spending through 2026 as margin pressures from the costs of its labor contract begin to subside, CFO Brian Newman tells WSJ. The delivery giant expects capital spending between 2024 and 2026 to comprise about 5.5% of total revenue, up from 4.9% the prior comparable period. UPS and union leaders last summer agreed to a new five-year pact, the costs of which were particularly substantial in the first year. The company is continuing to cut costs and boost efficiencies, for example by shedding 12,000 jobs and expanding use of RFID technology, Newman says.

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