Expanding the UPS Green Fleet

About UPS

• World's largest package delivery company and a global leader in supply chain services

• Headquartered in Atlanta, serves more than 220 countries and territories worldwide

• 397,100 employees worldwide • 16.3 million packages per day• 2013 Revenues: $54.1 billion• 100,069 vehicles• World’s 9th largest airline

Recent Recognition• FORTUNE magazine – World’s Most Admired

Companies• Ethisphere Institute – World’s Most Ethical

Companies• Inbound Logistics – Top 100 Motor Freight

Carriers• Maplecroft – Climate Innovation Index• Climate Counts – Top 10• Newsweek magazine – Green Rankings• Dow Jones Sustainability Index – S&P• Carbon Disclosure Project Leadership Index• EPA Climate Leadership Awards• Corporate Responsibility Magazine - 100 Best

Corporate Citizens•

UPS: No Bias As To Alternative Fuels/Technologies

• UPS’ “rolling laboratory” tests virtually all alternative fuels/technologies with more than 2,800 vehicles in operation worldwide.

• Natural gas – CNG and LNG

• Hydraulic hybrid

• Propane

• Electric hybrid

• Fuel cells

• Plug-in Electric

Corporate Automotive Engineering Confidential Information Internal Use Only © Copyright 2013, UPS, Inc. All rights reserved.

U.S. Domestic Alternative Fuel and Advanced Technology Vehicles

U.S. Alternative Tech Vehicles Total: 2,072

Compressed Natural Gas (CNG) Vehicles: 940(car group = count)

P70C = 188 Package Cars P80C = 33 Package Cars P100C = 578 Package Cars P10CX = 50 Package Cars HSC = 46 Shifters HTDAT= 45 Tractors

Hybrid Electric Vehicles (HEV): 380 P70H = 25 Package Cars P100H = 355 Package Cars

Electric Vehicles: 102 P70E = 40 Package Cars P100E = 62 Package Cars

Propane Vehicles: 18 P80XP = 10 Package Cars HSP = 8 Shifters

Composite Body Diesel Vehicles: 251 P63D = 251 Package Cars

Liquid Natural Gas (LNG) Vehicles: 340

Updated: 4/11/2014

Hydraulic Hybrid Vehicles (HHV): 41 P10HH = 41 Package Cars

Corporate Automotive Engineering Confidential Information Internal Use Only © Copyright 2013, UPS, Inc. All rights reserved.

Global Alternative Fuel and Advanced Technology Vehicles

Total Alternative Tech Vehicles (U.S. & International): 3,135

Updated: 10/11/2013

U.S. Alternative Tech Fleet: 2072 Compressed Natural Gas Vehicles: 940 Hybrid Electric Vehicles: 380 Liquid Natural Gas Vehicles: 340 Propane Vehicles: 18 Electric Vehicles: 102 Hydraulic Hybrid Vehicles: 41 Composite Body Diesel: 251

International Alternative Tech Fleet: 1,063 Compressed Natural Gas Vehicles: 91 Hybrid Electric Vehicles: 6 Propane Vehicles: 852 Electric Vehicles: 44 Ethanol Vehicles: 50 Biomethane Vehicles: 20

Expanding the UPS Green Fleet with LNG

Kenworth T800 - Extended Day Cab- Single Rear Axle- Fuller 10 Speed Transmission

Alternate Fuels and Advanced Technology Equipment Spark Ignited LNG

Performance Statistics• In 2013…

• UPS vehicles traveled 2,373,467,743 miles• UPS vehicles used 324,088,987 gallons of fuel• Gasoline package cars averaged 8.54 MPG• Diesel package cars averaged 10.18 MPG• Tractors averaged 6.39 MPG

• * Numbers represent domestic fleet only

Background1. There is an abundance of Natural Gas available in the U.S. 2. Liquefied natural gas, or LNG, is natural gas that has been

converted to liquid form for ease of storage or transport.3. Tractor Manufacturers have been developing tractors in

order to utilize natural gas as a transportation fuel.4. Various incentives (grants and tax) are available to offset

some of the capital investment associated with LNG as a transportation fuel.

5. LNG fuel is substantially less expensive than Diesel6. LNG/CNG fit the UPS sustainability mission

BackgroundBenefits of LNG as a Transportation Fuel1.Reduces dependence on Foreign Oil2.Lower Emissions than Diesel Fuel3.Financial ($1.75 per gallon price gap)

Annual Savings*Miles per Day LNG SI

300 $ 14,382 400 $ 19,176 500 $ 23,970 600 $ 28,763 700 $ 33,557 800 $ 38,351 900 $ 43,145

1000 $ 47,939 1100 $ 52,733

Fleet Perspective- The LNG experience”

The first 10 duel fuel LNG tractors and 1 Mack SI were put in service in Ontario,Ca in 2001.

In 2011 we introduced the Kenworth/ Westport HPDI to the UPS fleet in Ontario and Las Vegas NV.

In 2012 that build continued with additional tractors added to Salt Lake City and Beaver Utah.           

Fleet Perspective- The LNG experience”

Experiences along the way

Kenworth & Westport support on initial build was excellent for driver and mechanic training.

Good dealer support and network.          

Fleet Perspective- The LNG experience”

Experiences along the wayTractor range was very dependent on:Driving skillsTerrainWind conditionsType of trailer combinationWeight of loadsFueling skills of driverConditioning tanks on initial fills          

Fleet Perspective- The LNG “experience”

Experiences along the wayLNG shop requirements were difficult to understand.Limited locations to benchmark from.Consultants were needed to move forward with shop designs. Maintenance issues had a steep learning curve.         

Fleet Perspective- The LNG “experience”

Experiences along the way

Very good driver acceptance after initial fear of LNG and a different design of truck.

Very good press and media coverage.         

Fleet Perspective- The LNG experience”

Lessons Learned

Internal roles & responsibilities established for:Driver trainingFuelingShop requirements & designFueling station MaintenanceLNG vehicle,tank inspections & maintenanceVehicle specific daily usage based on miles run          

Fleet Perspective- LNG Fueling stationsPublic station needs

Location is everything!

Close to main highwaysAccessible for long combinationsReliability of station- quick response & resolution24/7 operationLarge enough to avoid wait time and congestionConsistent point of contact              

Continued Improvement

While operating its current alternative fuel and technology vehicles, UPS is also working with manufacturers, government agencies and nonprofit organizations to advance new fuel technologies and find cheaper, cleaner-burning domestic fuels that are better for the environment and more sustainable than conventional diesel.

Expanding the UPS Green

2014 Initiatives

Continue LNG Tractor deployment (Est.984 total)Deploy 45 CNG Class 8 tractorsInitial roll-out of Propane package car fleet expansion (1000 planned)

Expanding the UPS Green

Thank You!