UPS United Parcel Service

By Paul Ziobro 

United Parcel Service Inc. named Jim Barber as chief operating officer, giving the globe-trotting executive an inside track to eventually lead the package-delivery giant.

Mr. Barber, 57 years old, is a UPS lifer who has led the company's international business for the last five years. On Tuesday, he was elevated to the position most recently held by current CEO David Abney, who rose to the top job in 2014.

Mr. Abney, 62 years old, still has several major tasks on his plate. UPS is in the midst of a multiyear spending plan to modernize, expand and speed up its global network so it can better accommodate the secular shift to online shopping. The Atlanta-based company recently added another $7 billion to its capital spending plan over the next three years.

Investors have been frustrated with the spending outlay, especially as profit margins have continued to fall as UPS struggles to handle the rising number of packages in its network. Shares of UPS are down 10% so far this year.

UPS is also working to finalize its collective-bargaining agreement with the International Brotherhood of Teamsters union before the current contract expires on July 31. The contract covers more than 250,000 UPS package drivers and other employees, making it one of the largest agreements in the U.S.

UPS has a "promote from within" culture where all of its CEOs have deep roots at the company with orderly transitions at the top. CEO tenures most recently have run around five years, giving Mr. Abney more than a year to hit that mark.

UPS spokesman Steve Gaut declined to comment on future leadership decisions.

Mr. Barber started with the company as a delivery driver in 1985. He helped lead a second wave of international expansion in Europe in the 1990s. As head of the international division since 2013, he has overseen UPS's vast network outside the U.S. and helped push the company into more emerging markets.

He relocated to the Atlanta area last year after living overseas for many years, and his current role will give him oversight of a broad swath of the company's operations, including a region that has struggled at times to cope with increased volume in recent years.

During the most recent holiday season, UPS grappled with a surge in packages immediately after Thanksgiving and had to spend an additional $125 million to clear the backlogs and ensure timely deliveries before Christmas.

UPS named another company veteran to replace Mr. Barber. Nando Cesarone, 46 years old, will now become international president after having served as president of the company's European division since 2015. Mr. Cesarone, who has been with UPS for 27 years, will also join the company's management committee.

Write to Paul Ziobro at Paul.Ziobro@wsj.com

(END) Dow Jones Newswires

March 06, 2018 11:45 ET (16:45 GMT)

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