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UPS slashes workforce by 20,000 in response to reduced Amazon shipments

UPS plans to cut 20,000 jobs and close 73 facilities to reduce costs in response to slowing global trade and lower Amazon shipments, while posting higher-than-expected profits.

UPS announces significant job cuts and facility closures in response to declining Amazon shipments. Photo: GLR composition/ Finnancial Post & Peru Retail
UPS announces significant job cuts and facility closures in response to declining Amazon shipments. Photo: GLR composition/ Finnancial Post & Peru Retail

In a move to reduce costs and navigate the economic uncertainty, UPS (United Parcel Service) has announced it will cut 20,000 jobs and shut down 73 facilities. This drastic decision comes as a response to a potential pullback in shipments from its largest customer, Amazon, and broader global trade challenges.

The company also revealed that its first-quarter profits exceeded market expectations, despite these difficult circumstances.

UPS announces major layoffs amid declining Amazon shipments

As Amazon accounted for 11.8% of its overall revenue in 2024, UPS is bracing for the impact of reduced shipments from Amazon. UPS' plans to slash Amazon shipments were first outlined in January 2025

"The actions we are taking to reconfigure our network and reduce cost across our business could not be timelier," CEO Carol Tome said.

UPS' strategic moves: automation and asset sales

UPS is increasing its automation efforts and selling off non-core assets, as the company is expected to save around $3.5 billion in 2025 to mitigate the expenses incurred due to layoffs and facility closures.

Despite the decision to cut 20,000 jobs, they are still trying to optimize its network and reduce operational expenses. However, they do not dare to make long-term predictions regarding the future of the company amid this kind of uncertainty.

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