UPS ditched Amazon to be more profitable. Now it’s slashing 20,000 jobs and plans to close over 70 facilities

• Global Courier UPS Cut 20,000 jobs and automatically hundreds of facilities because it is tried to boost profits between a large overhaul of its shipping network. Last year, the company announced an ambitious plan to escape from Amazon In favor of more useful packages – before Tariff notifications in Trump’s tariff sends the Trade Trade Volumes.

Parcel Service Makes the waves early this year in this announcement of a breakdown of the world’s largest ecommerer retailer. Amazon, a competitor as well as a customer carrying a tenth tenth income of UPS, with no use for shipper, and In January This year, UPS announced plans to slay the number provided for Amazon by 50% in about a year and a half.

“This is our biggest customer, but they are not our most useful customers,” UPS CEO Caro Carol Tomé said in a conversation with Bloomberg Televisionthat describes the action as “controlled by our destiny.”

Three months later, that destiny has become clearer as ups announces plans to slash 20,000 jobs, close 73 facilities, and retool its shipping network to use less human labor-changes the shipper said Were “in line” with the Amazon Volume it was losing, but also set it up to be more profitable going forward.

“We have put out the biggest regeneration of our history,” Tomé says company INCoMe Call Tuesday after announcing changes.

The Amazon delivery quits the giving up “not useful for us, nor a healthy fit for our network,” he said. What, the UPS plans to increase automation, he says, “reduces our trust in working [and] Reduce capital requirements to run on network. “

About half of the buildings closed the Eastern US, CFO Brian Dykes said. 20,000 jobs are cut “will be done across the US network.”

Modernization pushes ups, parts previously announced, involves consolidation and end of 200 years in five years. Under the plan, nicknamed “network in the future,” the shipper has automatic package arrangement; It also looks at the use of robotics for tasks such as loading and unloading trailers and applying labels, Tomé told investors.

In the end, about 400 UPS ‘network facilities can be partially or fully automatic, Nando Cesarone, US president, told investors. “The result can be more efficient surgery that is less confident in working,” he said.

That’s the unwanted news of teamsters union, representing about 350,000 UPS workers, and that also got a Contract history For its workers two years ago.

“If UPS wants to continue to ruin corporate management, teamsters do not stand on his way,” Sean owners Sean O’Brien said to a statement. “But if the company desires our contract or makes any attempt to follow hard fighting, good teamsters, up with a hell of a fight.”

Submitting Uncertainty ahead

DECOUPLING UPS from Amazon can be a quick side of it again, however. Weeks after it announced that the change, President Donald Trumps to Tarko in US trading in thousands of things and launches successive high-stakes in many countries. Now, imports pay a baseline 10% tariff of all imports and 145% of most imports from China, while different rates of “rackecal tariffs” at approximately 60 Nations set to kick in this summer.

That disgrace means fewer shipments for UPS in February and March, and brought the ship to the Yank’s income guidance for the rest of the year.

“The world is not faced with many potential sales effects for more than 100 years,” Tomé said. “The only thing for sure if we don’t know what, if any, in our scenarios play.”

Only 2% of the number of UPS from international packages, executives said. However the to-us-to-us-US patora lines are most useful, Tomé told investors. But to router the route, the company saw the demands growing in shipments from China to the whole world, as well as from Europe, Thailand, and Vietnam.

The company expects a 9% US shipping drop in the second quarter and a moderate drop of income.

“There is a lot of uncertainty around China, now it is announced,” says Tomé. “We don’t know what happens. We don’t know if it’s worth it. There are so many things we don’t know.”

This story originally shown Fortune.com

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