UPS · 10-Q · 2026Q2 · Full report
Supply Chain Constraints
UNITED PARCEL SERVICE INC · 2026-08-05 · Importance 40 · Surprise 42 · In source text
UPS experienced air-capacity constraints after permanently grounding and retiring its MD-11 fleet in the fourth quarter of 2025. The company used third-party leased aircraft and charter capacity to address the shortfall, while Middle East conflict-related network disruptions increased charter utilization and fuel costs. During the first six months of 2026, UPS took delivery of five Boeing 767-300 aircraft accounted for as finance leases, beginning to reduce third-party aircraft expense. Two aircraft were temporarily idled for about six months to better match capacity with current demand and are expected to return to service in the third and fourth quarters of 2026.
Key facts
- As of June 30, 2026, we had two aircraft temporarily idled for an average period of approximately six months and expect these aircraft to return to operational service during the third and fourth quarters of 2026. source
- Following the permanent grounding and retirement of our MD-11 fleet in the fourth quarter of 2025, we experienced increased third-party lease expense to address capacity constraints. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| revenue | negative | probable | — | As of June 30, 2026, we had two aircraft temporarily idled for an average period of approximately six months and expect these aircraft to… |