UPS strong amid stalled US recovery

UPS chairman and CEO Scott Davis has said that while he did not expect a doubledip recession, he does however, anticipate slow growth going forward. “The odds are higher than they were six months ago, nine months ago,” he said recently. “There’s risk of a double-dip recession, but I think it’s unlikely.” UPS CFO Kurt Kuehn said he expects the economy to remain troubled through 2012. “The US is stagnant. We are not seeing an uptick,” Kuehn said. “In no way, shape or form are we seeing an improvement in the US.” But UPS expects revenues and profits to grow over the next three to five years. “Nearly every plausible scenario continues to see an expansion of global trade,” Davis said. “It offers the best path out of continued economic doldrums.” Calling government statistics “a lagging indicator,” Kuehn said others were overly optimistic about the economy’s trajectory in July but international air freight has slowed more than the company had expected, particularly from Asia, and all measures of global economic confidence have continued to decline. “2012, for better or for worse, is going to be another below-trend year,” he said. “The next 12 months may be a little bumpy.”