UPS Plans Up to 30,000 Job Cuts as It Reshapes Its Logistics Network in 2026

UPS plans up to 30,000 job cuts, facility closures, and driver buyouts in 2026 to save $3 billion, as the carrier adjusts its U.S. logistics network following reduced Amazon shipping volume.

United Parcel Service (UPS) is accelerating efforts to right-size its U.S. logistics network, announcing plans to cut up to 30,000 operational roles, launch a new voluntary driver buyout program, and close dozens of facilities in 2026.

The moves are part of a broader cost-reduction and network optimization strategy as UPS continues to adjust to significantly lower shipping volumes from Amazon, its largest customer.

Cost Savings and Network Consolidation

During the company’s fourth-quarter earnings call, UPS Executive Vice President and CFO Brian Dykes said the latest measures are expected to generate $3 billion in cost savings this year. The initiative builds on major reductions already completed in 2025, when UPS eliminated approximately 48,000 operational positions and finalized a full-time driver buyout program.

As part of the restructuring, UPS plans to close 24 buildings in the first half of 2026, with additional closures possible later in the year. The carrier shuttered 93 facilities last year, reflecting an ongoing shift toward a leaner, more agile distribution footprint.

Amazon Volume Decline Drives Capacity Reset

UPS has been steadily reducing its reliance on Amazon shipments as part of a long-planned “glide-down.” After cutting roughly 1 million packages per day in 2025, the company expects another 1 million daily package reduction in 2026, further reshaping linehaul, sortation, and last-mile capacity needs.

The volume decline has weighed on near-term performance. UPS reported a 3.2% year-over-year drop in U.S. domestic revenue in Q4, but executives expect operational improvements once the Amazon transition concludes in the first half of the year.

“By the second half, we’ll be operating a more agile and efficient U.S. network,” Dykes said.

USPS Partnership Strengthens Last-Mile Economics

UPS is also leaning on its renewed Ground Saver agreement with the U.S. Postal Service (USPS) to improve delivery economics. Under the deal, UPS hands off select Ground Saver parcels to USPS for final-mile delivery, helping reduce last-mile costs while maintaining service standards.

CEO Carol Tomé noted that the transition is already underway and will continue ramping up over the coming months.

“This agreement improves the economics of the product while ensuring service expectations are met,” Tomé said.

What This Means for the Logistics Industry

UPS’s latest moves highlight a broader industry trend: carriers are prioritizing cost discipline, facility rationalization, and smarter last-mile partnerships as parcel volumes normalize post-pandemic. For shippers, the shift underscores the importance of flexible carrier strategies, diversified delivery options, and data-driven network planning in an evolving logistics landscape.