FedEx, UPS Ramp Up Asia Delivery Capacity

Package delivery companies United Parcel Service and FedEx added freight flights to Asia, tapping into growth in Asia shipments.

UPS said it began direct next-day delivery from Hong Kong to Europe on Monday and could expand between Europe and other parts of Asia.

FedEx unit FedEx Express on Monday launched non-stop flights between South Korean and its Memphis, Tennessee hub. The company pointed to a 35 percent annual jump to $39 billion of goods exported from the United States to South Korea last year.

Hong Kong last year was one of UPS's fast growing markets, and Europe is Hong Kong's second-largest trading partner, Dan Brutto, UPS International president, said in an interview.

"The milestone for us is going to be continue to fill that plane up and certainly we'll look at other opportunities to serve the European market from other areas of Asia based on the success of this flight," Brutto said by phone from Brussels.

UPS, the largest package delivery company, launched the once-daily direct flights between Hong Kong and its hub in Cologne, Germany, to ship small packages and heavy freight Monday through Thursday on Boeing (BA.N) 747-400 aircraft.

These are in addition to 11 flights from Hong Kong to Europe each week via Dubai.

The first direct flight took off earlier on Monday and was 100 percent full, Brutto said.

Shipments were "broad-based across many companies that are sending critical parts, samples, high-tech goods, automotive components," he said. "Hong Kong last year was one of our fastest growing areas of the company, and we've got a lot of customers that like to get into the European market on a next-day basis."

UPS's shares were up 2.1 percent to $73.57 in midday trading Monday, and are up about 13 percent over the past 12 months.

FedEx Express added four nonstop Boeing 777 freighter flights each week connecting Memphis and South Korea.

"Korea is the seventh-largest trading partner of the U.S. in terms of two-way trade, which is expected to increase after final approval of the U.S.-Korea Free Trade Agreement," Michael Ducker, FedEx Express chief operating officer, said in a statement.

FedEx shares were up 2.1 percent at midday to $92.18 and are off about 1 percent over the past 12 months.