New York City will charge drivers going downtown. Taxi cabs cross 42nd Street as the sun rises on December 8, 2022, in New York City. Small and medium-sized businesses lower in the pecking order than big-box chains would see the most delays from a lengthy strike, logistics experts say. Overall, UPS handled 18.7 million domestic packages a day on average in the first three months of this year. And its share of shipments is even greater than that number indicates, since many of the packages being delivered by the US Postal Service are moved by UPS. UPS delivers about a quarter of all US packages to their final destination, according to Pitney Bowes, a global shipping and logistics firm, and there is not enough capacity in the market to replace UPS. “From an economic perspective, we’re going to have a very muted peak season.”īusinesses have also had time to prepare for the possibility of a strike.įedEx and other carriers have encouraged shippers for months to switch away from UPS to avoid any delays from a strike. “If you look at the overall market, nobody is seeing a pickup anymore,” Roberson said. UPS’ revenue fell 6% in the first quarter compared to a year earlier and it said in April that it expects “volume to remain under pressure.” In fact, many companies are stuck with too much merchandise right now. That means demand isn’t as high as it was earlier in the pandemic, and retailers don’t need to bring in as much inventory for back-to-school shopping and the holidays. The economy has slowed and many consumers have pulled back on discretionary goods like electronics and clothing. UPS and the Teamsters' union contract expires August 1. “The big lesson learned from that strike was to diversify,” said Cathy Roberson, the head of Logistics Trends & Insights, a supply chain research firm. Gig companies such as Uber have since entered the market to deliver, too. Walmart, Target and other retailers have also built their own last-mile delivery operations and offer customers the option to buy online and pick up their orders in stores. Shippers have more options than they did in 1997: FedEx and regional carriers have grown since then, and Amazon’s logistics operation didn’t even exist then. In a worst case scenario, a longer-term UPS strike could cause major disruptions to the US supply chain network. However, if the strike lasts longer than a week, there will be some empty shelves, higher prices, and slower package deliveries for customers, they say. How bad could it get? Logistics experts predict that a short UPS strike would not be as devastating as it was in 1997 because things have changed in the intervening quarter-century: There are more shipping alternatives, for example. Striking employees of UPS in Chicago in 1997, the last major UPS work stoppage.
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